Ireda inks MoUs with 3 state lenders

New Delhi: Indian Renewable Energy Development Agency Ltd (Ireda) seems to be on a drive to tie up with public-sector lenders to engage in co-lending, co-origination, and loan syndication for all categories of renewable energy ventures, including small hydro projects.

It has signed Memorandums of Understanding (MoUs) with India Infrastructure Finance Company Ltd (IIFCL), the Union Bank of India (UBI), and the Bank of Baroda (BoB).

Ireda is a Mini Ratna (Category-I) public-sector enterprise under the administrative control of the Ministry of New and Renewable Energy (MNRE). Established as a non-banking financial institution in 1987, it is engaged in promoting, developing, and extending financial assistance for setting up projects relating to new and renewable sources of energy and energy efficiency and conservation.

A wholly-owned government company, IIFCL was set up in 2006 to provide long-term financial assistance to viable infrastructure projects.

Ireda and IIFCL will strive to also fix interest rates for Ireda borrowings for a period of three to four years. Further, IIFCL may invest in the bonds issued by Ireda, as per the terms and conditions of the issue. Ireda’s MoUs with UBI and BoB are aimed at lending at the retail level, as both banks have an extensive nationwide presence with a vast network of branches. The green lender wants to extend its reach with the two public-sector banks, especially in tier-2 and tier-3 cities and rural areas.

This, Ireda believes, will enable it to provide unique and innovative financial support to existing and new customers. The objectives of Ireda, as per its website, are to: give financial support to specific projects and schemes for generating electricity and/or energy through new and renewable sources and conserving energy through energy efficiency; and maintain its position as a leading organization to provide efficient and effective financing in renewable energy and energy efficiency/conservation projects.

Other objectives are: increasing its share in the renewable energy sector by way of innovative financing; improving the efficiency of services; and striving to be a competitive institution.