India’s ambitious plan to invest $450 billion for financing of its 2030 targets for renewable energy generation capacity can face serious challenges if operational projects do not access capital markets to recycle capital and attract new investor classes, according to a latest study.
India has committed to ambitious action on climate change, pledging to achieve 40 per cent of the country’s electricity generation capacity by 2030 through renewable sources. The government has also set a near-term target of achieving 175 GW of renewable energy capacity by 2022, a significant increase from the current level of 80 GW, requiring an additional $100 billion in financing.
These figures will increase to $450 billion through 2030. Assuming a typical financing ratio of 70 per cent debt and 30 per cent equity, the debt funding requirements translate to $330 billion over the next decade.
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