The IFC, the private investment arm of the World Bank, has said it will invest $50 million in MRPL (Mahindra Renewables Pvt Ltd), a wholly-owned subsidiary of Mahindra Susten Pvt Ltd, the cleantech arm of the Mahindra group, the Business Standard has reported.
In an international competitive bidding round, Mahindra Renewables was awarded a 250 MW solar power project last October, which is part of the 750 MW AC solar park in the Rewa district of Madhya Pradesh, owned by Rewa Ultra Mega Solar limited (RUMSL). Funding will be carried out via transactions advised by the IFC’s public private partnership team.
RUMSL is a joint venture between the Madhya Pradesh state government agency, MP Urja Vikas Nigam Limited (MPUVNL) and the Solar Energy Corporation of India (SECI) – India’s solar nodal agency.
The approved IFC investment involves a straight loan up totaling INR 3.2 billion (equivalent to $50 million) and could assist in a parallel loan of up to INR 6,400 million ($100 million).
The solar park is to be developed on 1,500 hectares of land across five villages: Badwar, Barsaita Desh, Barsaita Pahad, Etar Pahad and Ramnagar Pahad in the Rewa district.
The investment will be utilized for the development, financing, construction, operation and maintenance of the first 250 MW phase of the 750 MW power plant, near the villages of Badwar and Barasita.
MRPL will enter into a contract with turnkey EPC company, Mahindra Susten to execute the project, which is expected to be completed by December 2018. It should generate employment for 500 to 550 construction workers, and 65 employees to operate the plant.
Given the increasing importance of the Indian solar market, the IFC announced in 2016 that it would invest $6 billion over the next five years.