Mobilizing Finance for India's Renewable Energy Revolution: Key Takeaways from National Workshop

The workshop stemmed from a review meeting chaired by Prime Minister Narendra Modi, where the acceleration of flagship programs like PM Surya Ghar and PM-KUSUM was discussed.

Union Minister for New & Renewable Energy, Shri Pralhad Joshi, emphasized the pivotal role of financial mobilization in achieving India’s ambitious target of 500 GW of renewable energy capacity by 2030. Addressing the National Workshop on Mobilizing Finance for Renewable Energy, organized by the Ministry of New & Renewable Energy (MNRE) in Mumbai, he called for a collective effort from financial institutions and policymakers to ensure accessible and affordable funding for the renewable energy sector.

Key Highlights from the Workshop

India’s Renewable Energy Ambitions

The workshop stemmed from a review meeting chaired by Prime Minister Narendra Modi, where the acceleration of flagship programs like PM Surya Ghar and PM-KUSUM was discussed. Minister Joshi highlighted India’s rising energy demand, projecting a doubling of energy consumption as the country moves toward becoming the world’s third-largest economy. He underscored the importance of scaling up renewable energy to match thermal power production, ensuring a resilient energy future.

Financial Institutions Must Adapt

With India committed to achieving Net Zero by 2070 and 500 GW of non-fossil fuel-based energy by 2030, Shri Joshi urged financial institutions to align their lending policies with India’s clean energy roadmap. He stressed that carbon-intensive industries will face dwindling export opportunities in the future, making a strong case for a sustainable financial framework that prioritizes renewable investments.

The Minister noted that India has already made significant progress in renewable energy, with capacity surging to 222 GW. He pointed to falling solar tariffs, citing a recent bid in Madhya Pradesh that reached a historic low of ₹2.15 per unit compared to ₹11 per unit in earlier years. However, he cautioned that large-scale deployment of renewables must be complemented by advancements in battery storage solutions.

Decentralization and Financial Simplification

Shri Joshi underscored the role of decentralization, emphasizing that programs like PM-KUSUM and PM Surya Ghar empower farmers as “Urjadata” (energy providers) while also mitigating transmission losses. He urged banks to simplify financing processes, especially for rooftop solar projects, and proposed the introduction of a Renewable Energy Financing Obligation, akin to Renewable Purchase Obligations (RPOs), to secure dedicated funding for the sector.

India’s Leadership in Green Hydrogen (GH2)

Highlighting India’s leadership in green hydrogen, Shri Joshi revealed that the country has secured major export orders, outpacing several developed nations in the sector. He stated that India’s young workforce and strong industrial capabilities make it an attractive destination for clean energy investments.

The Minister further cited Prime Minister Modi’s directive to engage global financial institutions for renewable energy investments. He highlighted India’s success in securing financial commitments worth ₹34.5 lakh crore during a recent global renewable energy summit in Gandhinagar. Concluding his address, Shri Joshi reinforced that transitioning to renewable energy is not optional but a necessity and called for a national movement to push for renewable energy financing.

The Financial Blueprint for 500 GW by 2030

Union Minister of State for Power and New & Renewable Energy, Shri Shripad Y. Naik, stated that achieving 500 GW of renewable energy by 2030 would require an estimated investment of ₹30 lakh crore. This would cover infrastructure, transmission, and storage systems. He called for innovative financing models, flexible lending terms, and prioritization of green investments to accelerate the energy transition.

MNRE Secretary, Smt. Nidhi Khare, underscored the importance of affordable finance, green bonds, and innovative funding models in facilitating India’s renewable energy transition.

Key Sessions and Takeaways

The workshop featured four key sessions, each addressing critical financing challenges in the renewable energy sector:

1. Financing Utility-Scale Renewable Energy Projects

   • Discussions revolved around interest rates, risk perceptions, and the role of banks and NBFCs in funding large-scale renewable energy projects.
   • Experts explored mechanisms to reduce financial risks and enhance capital availability for developers.

2. Investing in Emerging Renewable Technologies

   • This session focused on financing offshore wind, floating solar, and green hydrogen.
   • Strategies for capital allocation, policy interventions, and financial risk mitigation were discussed with participation from NABARD and leading financial institutions.

3. Financing Distributed Renewable Energy (DRE) and Innovative Applications

   • Experts analyzed financial barriers for startups and the need for policy support to expand rooftop solar, canal-top PV, and Agri-PV projects.
   • Solutions to improve access to finance and mitigate perceived investment risks were explored.

4. Regulatory and Capacity Building for Banks and NBFCs

   • The session examined RBI guidelines, sector-specific lending policies, and the need for improved regulatory frameworks.
   • Discussions centered on risk-sharing mechanisms and financial instruments that can unlock capital for renewable energy investments.

A Roadmap for the Future

Key takeaways from the workshop emphasized:

• The need for low-cost financing to make renewable energy more competitive.
• Better access to global climate funds to support large-scale clean energy investments.
• Strengthening public-private partnerships to facilitate large-scale renewable energy adoption.
• Expansion of green financial instruments to mobilize capital effectively.

Financial Institutions Pledge Support

Senior officials from major public and private sector banks attended the workshop, including representatives from State Bank of India, HDFC Bank, ICICI Bank, Axis Bank, Punjab National Bank, Bank of Baroda, and others. These financial institutions reaffirmed their commitment to supporting India’s renewable energy transition by streamlining lending processes, reducing compliance burdens, and adopting a proactive approach toward clean energy financing.

Conclusion

The National Workshop on Mobilizing Finance for Renewable Energy marked a significant step toward ensuring that financial constraints do not hinder India’s ambitious clean energy goals. By fostering collaboration among policymakers, financial institutions, and industry leaders, the event reinforced India’s leadership in the global renewable energy revolution. Stakeholders pledged to adopt innovative financing models and policy frameworks to bridge the financial gap and propel the country toward a sustainable and financially inclusive energy future.