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IRFC Expands into Renewable Energy Financing with Rs7,500 crore Loan to NTPC Green Energy

The Indian Railway Finance Corporation (IRFC) has taken a significant step into renewable energy financing by extending a Rs7,500 crore rupee term loan to NTPC Green Energy. This move aligns with India's ambitious target of installing 500 GW of non-fossil fuel-based energy capacity by 2030. Traditionally focused on funding Indian Railways, IRFC is now expanding into power generation and transmission projects linked to the railway sector.

New Financial Commitments

Apart from funding NTPC Green Energy, IRFC is also lending Rs3,100 crore to a thermal power subsidiary of NTPC. The corporation recently attained ‘Navratna’ status, granting it greater operational and financial autonomy. Additionally, IRFC has partnered with REMC to finance renewable energy projects for railway power supply.

Bridging India's Renewable Energy Finance Gap

India requires an estimated Rs30 lakh crore in debt financing to meet its clean energy goals. To address this, policymakers are advocating for financial institutions to adopt a renewable energy financing obligation. Minister of New and Renewable Energy, Pralhad Joshi, recently emphasized the need for mobilizing capital, while Parliament’s standing committee on energy has called for innovative financing mechanisms such as infrastructure investment trusts, green bonds, and crowdfunding.

Growing Role of Public Sector Lenders

Alongside IRFC, other public finance entities like Power Finance Corporation, REC Limited, and IREDA are actively supporting renewable energy projects. With increased financial backing and policy support, India’s renewable energy sector is set to receive much-needed capital to accelerate its clean energy transition.