The Indian Renewable Energy Development Agency Limited (IREDA) has entered into a $35 million sub-loan agreement with the Rewa Ultra Mega Solar (RUMSL) for the development of the Rewa and Mandsaur solar projects in the state of Madhya Pradesh.
According to a report by the Press Trust of India (PTI), the funds will be used to develop 750 MW of transmission and evacuation infrastructure at Rewa and 250 MW of infrastructure at Mandsaur. The capacity will be used by grid-connected solar photovoltaic projects.
Commenting on the development, RUMSL chairperson Manu Srivatsava said, “We have signed a loan agreement for $35 million for the Rewa and Mandsaur projects.” Srivatsava added that these are the first projects to receive a loan from the $100 million in funding provided to IREDA by the World Bank.
The deal comes after the government of India in November 2017 signed agreements with the World Bank to develop large-scale solar parks. Under the deal terms, the World Bank agreed to provide $100 million (~₹6.5 billion) in funding to assist in their development.
The total includes a $75 million (~₹4.9 billion) loan from the International Bank for Reconstruction and Development (IBRD) that will mature in 19 years and has a five-year grace period, a $23 million (~₹1.5 million) loan from the Clean Technology Fund (CTF) which has a 10-year grace period and a maturity of 40 years, and a $2 million (~₹130 million) interest-free CTF grant.
IREDA is the nodal project implementation unit for the loans.
Mercom reported last March on another planned World Bank loan to the Rewa Ultra Mega solar park. That $25 million (~₹1.62 billion) loan, which was also earmarked for infrastructure development, had a 0.25 percent interest rate for 40 years.
Image credit: RUMSL
Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.