ReNew, India’s leading clean energy company, has tied up with 12 international lenders, for $1 billion loan.
This will be the largest External Commercial Borrowings (ECB) project finance loan in the country’s renewable sector, for any single project. RaboBank is the lead bank.
ReNew will use the $1 billion loan for its hybrid Round-the-Clock (RTC) battery-enabled project. The interest rate, after hedging, is expected to be lower than the company’s current average cost of debt on its balance sheet.
ReNew has signed a PPA with the Solar Energy Corporation of India (SECI) for this project, which will see wind and solar farms set up across Karnataka, Rajasthan, and Maharashtra states.
“This loan — the single-largest project finance in India’s renewable sector — highlights the interest of global lenders in ReNew as it helps spearhead India’s historic clean energy shift,” Sumant Sinha, Founder, Chairman and CEO, ReNew, said.
The RTC project will supply power day and night and compete against the baseload of fossil-fuel energy providers, such as coal.
In April, Mitsui & Co. picked up 49 percent stake in the RTC project. The project will provide power to SECI at the rate of ₹2.90 per unit to begin with, which will increase 3 percent annually for 15 years and then stabilise for the remaining 10 years of the 25-year PPA.
This ECB loan follows ReNew’s refinancing last month of its dollar-denominated bonds with domestic borrowings.