India weighs models to raise $1-tn in green finance

The government is holding consultations on ways to mobilize about $1 trillion in green finance to boost investments into clean energy as the 2030 deadline for 500 gigawatts of renewable capacity nears, according to two people aware of the discussions.

- Rituraj Baruah

In recent months, the Union ministry of new and renewable energy has discussed investments with state-run Power Finance Corp, Rural Electricity Corp. and Indian Renewable Energy Development Agency, along with other players, said the people quoted above on the condition of anonymity.

The ministry is looking at the feasibility of contract for difference or CID for power-purchase agreements, which may be promoted instead of the conventional long-term pacts of up to 25 years, one of the two people quoted earlier said. Under Cfd, either party has to pay the difference between the contracted and the actual price. The ministry is also considering innovative models like mezzanine finance, which combines debt and equity, the person said.

Queries emailed to the ministry, Ireda, PFC and REC remained unanswered until press time.