MANU/PIBU/0591/2021

Department/Board : PIB

Date : 09.02.2021

Budget 2021-22 augments capital of SECI and IREDA to promote development of RE sector

National Hydrogen Mission proposed

Finance Minister Smt. Nirmala Sitharaman in her budget speech 2021-22 announced capital Augmentation of Solar Energy Corporation of India Limited (SECI) and Indian Renewable Energy Development Agency Limited (IREDA). She said "To give a further boost to the non-conventional energy sector, I propose to provide additional capital infusion of Rs. 1,000 crores to Solar Energy Corporation of India and Rs. 1,500 crores to Indian Renewable Energy Development Agency"

Solar Energy Corporation of India Limited (SECI), a public sector undertaking as an 'Implementing Agency' of the Ministry, plans and calls for tenders for development of RE projects on pan-India basis. SECI procures RE power at a central level, thereby reducing the off-taker risk of RE developers and sells it to DISCOMs. SECI's efforts have resulted in flow of investments from all over the world into the country's RE sector, and in a rapid decline in RE tariffs, which has led to large-scale uptake of RE in the country. The cumulative capacity installed in the country as on 31.12.2020 is 91,000 MW and further 50,000 MW of the projects are under implementation of which SECI's share is 54%. To give a further boost to the RE sector, an additional capital infusion of Rs. 1,000 crore to SECI has been provided which will enable SECI to float 15,000 MW of tenders on yearly basis. On yearly basis, it will attract investment of more than Rs. 60,000 crore, generate employment of 45,000 job years and reduce emissions of 28.5 million tons of CO2 per year. Capital infusion will also enable SECI to set up innovative projects of with an investment of around Rs.17000 Cr.

IREDA, a Mini Ratna (Category-I) company under the administrative control of MNRE was set up in 1987 to work as a specialised non-banking financing agency for the Renewable Energy (RE) sector. As a specialised RE funding agency, it has developed expertise in evaluating all types of RE projects and projects developers as well as entrepreneurs are more comfortable dealing with IREDA. International lenders are also happy to channelize their funds to India's large RE market through IREDA. With the equity infusion of Rs. 1,500 crore by Government of India, IREDA would be able to extend additional loan facility of Rs. 12,000 crore. This would be in addition to its existing book size of Rs. 27,000 crore. The additional equity will also improve its capital adequacy which will help IREDA in borrowing at lower rate of interest, thus lowering the interest rates for developers. It would also help in financing of around 4,500 MW of RE projects worth Rs. 18,000 to 19,000 crore. It will generate employment of 13,500 job years and reduce emissions of 8.55 million tons of CO2.

In the Budget Speech 2021-22 , Finance minister proposed to launch a National Hydrogen Mission for generating hydrogen from green power sources . She said "Prime Minister, while speaking at the 3rd RE-Invest Conference in November 2020, had announced plans to launch a comprehensive National Hydrogen Energy Mission. It is now proposed to launch a Hydrogen Energy Mission in ........