IFC will be investing US US $15 million equity financing to Shalivahana Green Energy Limited, a biomass power company. The investment will meet company’s expansion of about 200 Mw of its existing biomass power projects in Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, and Tamil Nadu.
Through its Post-2012 Carbon Facility, IFC will also commit to purchase up to 1.5 million Certified Emission Reductions or CERs from energy projects developed by Shalivahana during 2013 to 2020. IFC will pay for a pre-agreed percentage of the spot price of the CERs at the time of delivery, subject to a minimum price.
“IFC’s support will help us raise funds, adds credibility to our work, and raise the generation capacity of our portfolio over the next four years. The Post-2012 Carbon Facility will help us generate sustainable revenues in the long run despite the uncertainties in the global carbon market,” said M Komaraiah, CMD of Shalivahana Green Energy Limited.
The company plans to undertake small to medium-sized projects in the biomass, hydro, and wind-energy sectors. Eighty-percent of power generation in India comes from state-owned providers, with most private players focused on large thermal and hydro-power projects.
“Improving access to regular and clean power supply is a key strategic priority for IFC in India. Our Post-2012 Carbon Facility provides the Shalivahana Group with a high-quality revenue stream from CERs up to 2020 to strengthen the viability of their projects,” said Thomas Davenport, IFC Director for South Asia.
After the Indian government made adoption of renewable purchase obligations mandatory, state distribution utilities, open-access consumers, and captive power plants are required to buy a certain portion of their power purchases from renewable-energy sources.
Related Articles
