New Delhi: The Cabinet on Wednesday cleanses Equity Infusion of Rs 1,500 Crore to IRDA (Indian Renewable Energy Development Agency) to increase the loan capacity as the government’s target set 450 GW green energy capacity as part of fulfilling the COP26 net-zero appointment.
Equity infusion will increase Ireda’s net wealth, increase agency loan capacity to Rs 12,000 Crore.
This number will be good enough to finance up to 4,000 MW additional renewable capacity.
This will lead to reducing carbon emissions of more than 7 million tons of CO2 per year.
Ireda’s portfolio increased from RS 8,800 Crore to Rs 28,000 Crore in the last six years.
But according to the RBI norm, loans can be extended at 20% of the body’s net wealth.
This rule limits Ireda’s financing capacity to Rs 600 Crore because the net wealth is Rs 3,000 Crore.
Additional equity will also increase the ratio of capital-to-risk assets (crar), which will facilitate loan operations and borrow it, according to government statements.