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State Bank of India (SBI) has signed an agreement with Kreditanstalt für Wiederaufbau (KfW) to receive a low-interest loan of €150 million (~$150.66 million) to finance solar projects in India. The loan will primarily fund innovative technologies, such as automated dry cleaning of solar modules to reduce water consumption.
The Ministry of New and Renewable Energy has been recommending the use of robotic module cleaning technology, which uses less water for cleaning solar modules.
The application of robotic cleaning solutions is also economical when project sizes increase. The larger the project, the higher the cost of manual labor for panel cleaning, which is driving utility-scale developers and solar park operators to opt for automated cleaning solutions.
This is the second loan SBI has received from the German development bank. The first loan of €150 million (~$150.66 million) was granted in 2017 to finance larger solar farms with an output of between 50 and 250 MW and the infrastructure for connecting them to the electricity grid.
Over 600,000 MWh of renewable energy will be produced each year by the projects funded through the loans. The measures will also reduce greenhouse gas emissions by 500,000 tons of CO2 per year.
“We are helping the Indian government to meet the increasing demand for energy with environmentally sustainable means that include tapping into renewable energy sources and steering India’s power supply towards greater use of solar energy. In this way, household and commercial electricity consumers benefit from environmentally and climate-friendly electricity generation,” said Christiane Laibach, Member of the Executive Board of KfW Group.
KfW plans to raise €80 billion (~$90.35 billion) to €85 billion (~$96 billion) of funding in 2022, which will include at least €10 billion (~$11.3 billion) of green bond issuance.
Last December, the Government of India and KfW signed agreements for a €140 million (~$158.63 million) reduced interest loan and €2 million (~$2.27 million) grant for an energy reform program in Madhya Pradesh. The project comprised implementing smart meters, advanced metering infrastructure, and separating agriculture and non-agriculture feeders.
Earlier, REC Limited, a public infrastructure finance company involved in financing power projects, had entered into an agreement with KfW to avail official development assistance loan of $169.5 million.
KfW and Bank of Baroda had announced that they would extend funding of $113 million to refinance solar power projects in India under the Solar Partnership II – Promotion of Solar PV in India. Germany has committed to providing financing support through KfW Development Bank for solar photovoltaic investments.