New Delhi: "While the market demands green taxonomy-based benefits for funding of renewable and new technology projects, the high-ticket sized Green Hydrogen projects necessitate collaboration among the various financing institutions to meet the financing requirements of this sector", said IREDA CMD Pradip Kumar Dason Thursday. CMD further called upon NBFCs and banks to play a significant role in supporting Green Hydrogen developers, underscoring the collaborative responsibility to facilitate the development of the sector.
Das was speaking during a panel discussion at the “International Conference on Green Hydrogen 2023” (ICGH 2023) being organized at Vigyan Bhawan, New Delhi.
The panel discussion was focused on "Green Financing," attracted experts and stakeholders from Renewable Energy sector.
In his address CMD emphasized IREDA's commitment to financing the entire value chain of Green Hydrogen, aligning with the Govt of India’s vision outlined in the National Green Hydrogen Mission. He highlighted the message conveyed by the Hon'ble Prime Minister for ICGH 2023, emphasizing the crucial role of Green Hydrogen in achieving sustainable growth and decarbonization.
Das also emphasized the importance of Green Hydrogen in decarbonizing heavy industries such as steel, cement, and fertilizers under the NDC targets announced by the Government of India. He added that IREDA is committed to assuming a proactive role in the decarbonization of the entire economic value chain for these critical sectors, playing a "motherly" role in their development as was done in the past.
The CMD advised multilateral agencies to revisit for streamlining and expediting their sanction and financing processes and procedures in alignment with Indian NBFCs, adhering to the highest standards of Corporate Governance to ensure reduction in turnaround time and operational procedures. He further added that in the present regime, the multilateral agencies via development banks are expected to support through viability gap funding, equipment guarantees, contract for differences etc at initial stages.
Das signified the fact that for lenders, rather than the size of the project, what really matters is both the financial and economic viability of the project along with compliance towards the stipulated norms. He further highlighted the crucial role to be played by the demand aggregators for green hydrogen for providing comfort to the lenders towards assured repayments. Shri Das added that a parity needs to be established for pricing and off-take commitments of green hydrogen to ensure best repayment tenures for green hydrogen project funding.
Speaking on IREDA's commitment to project developers, Mr. Das stressed that project developers seek Clarity, Conviction, and Commitment, and IREDA has strived to meet their expectations to the best extent possible. In the spirit of ease of doing business, IREDA has sanctioned loans without personal visits of borrowers to the office.
He elaborated that IREDA has completed its AGM for adoption of annual accounts for FY 2022-23 in just 90 days post completion of financial year, which as a record also symbolizes high pace of growth along with commitment to best quality corporate governance and transparency.