Tata Power has secured a ₹4.5 billion (~$54.3 million) trade finance facility from Japan-based Mitsubishi UFJ Financial Group (MUFG) for two solar projects.

The funds will be used for a 100 MW solar project in Parthur, Maharashtra, and a 120 MW solar project in Mesanka, Gujarat.

Both projects will be executed by TP Kirnali (TPKL), a wholly owned subsidiary of Tata Power Renewable Energy Limited, the clean energy arm of Tata Power.

The funding marks MUFG’s first sustainable trade finance facility in India. It will also drive Tata Power’s contribution towards achieving India’s net-zero goals.

MUFG’s Head of Transaction Banking Asia Pacific Belinda Han said, “This facility is designed to support our clients’ sustainability agendas and catalyze the greening of global supply chains and we are excited to launch this in India.”

CFO of Tata Power Sanjeev Churiwala said: “We are committed to transitioning our business to make sustainable power available through clean energy sources. The association with MUFG will open up opportunities to explore raising more green finance as we expand our clean energy portfolio and significantly contribute towards India’s net-zero targets.”

Deputy CEO of MUFG India Shashank Joshi commented, “Industries such as the power sector have traditionally been highly carbon intensive, but there is a growing recognition of a need to change. This deal underpins MUFG and Tata Power’s joint commitment to renewable energy and ensures a strong sustainable source of green power to the country.”

MUFG has committed to achieving net-zero emissions in its finance portfolio by 2050 and its own operations by the end of the current decade, while the credit facility will help Tata Power achieve the same by 2045.

MUFG had extended a five-year syndicated financing facility of $163 million for Azure Power’s 300 MW solar project in Rajasthan.

Earlier this month, MUFG and Sumitomo Mitsui Banking Corporation, acted as principal lenders for a ¥27.95 billion (~$205.31 million) project loan facility for Adani Green Energy’s subsidiary to help refinance its debt.