The European Investment Bank (EIB) yesterday announced a new co-financing project with YES Bank – the fifth-largest private sector bank in India – that will support the development of solar and wind power projects in India.
Both financial institutes will each make available loans up to $200 million to assist in the streamlining of renewable energy projects being built and operated by leading Indian corporations and private sector developers.
The EIB says that it has already identified eligible solar power projects in the states of Karnataka, Maharashtra, Rajastan and Telangana. A further cluster of wind and solar projects are being examined, the bank said.
“This new $400 million financing program will make a significant contribution to the harnessing wind power and solar energy to produce green energy, create thousands of jobs during construction and strengthen technical and financial skills for the renewable energy sector to expand,” said EIB VP Andrew McDowell.
YES Bank has pitched itself as India’s “Green Bank”, underpinned by its commitment to finance 5 GW of renewable energy – a pledge the bank made in 2015. After the Paris Agreement at COP21 in December 2015, YES Bank also unveiled plans to mobilize up to $5 billion for climate finance by 2020.
The co-financing agreement is the first partnership between EIB and YES Bank, and is the first time that a commercial bank in Asia has supported renewable energy. YES Bank also says that the loan facility is the longest tenor loan it has made in the international loan market to date. Management of the loan facility will be overseen by YES Bank over the next three years.
Earlier this year the EIB released a $214 million loan extension to the State Bank of India for the explicit support of solar energy.