New Delhi, India, August 8, 2011—
IFC, a member of the World Bank Group, will provide $15 million in equity financing to Shalivahana Green Energy Limited, an Indian biomass power company, to help increase India’s power supply. IFC’s investment will support the company’s expansion of about 200 megawatts of its existing biomass power projects in the Indian states of Chhattisgarh, Jharkhand, Madhya Pradesh, Orissa, and Tamil Nadu.
Through its Post-2012 Carbon Facility, IFC will also commit to purchase up to 1.5 million Certified Emission Reductions or CERs from energy projects devyeseloped by Shalivahana during 2013 to 2020. IFC will pay for a pre-agreed percentage of the spot price of the CERs at the time of delivery, subject to a minimum price.
“IFC’s support will help us raise funds, adds credibility to our work, and raise the generation capacity of our portfolio over the next four years. The Post-2012 Carbon Facility will help us generate sustainable revenues in the long run despite the uncertainties in the global carbon market,” said M. Komaraiah, Chairman and Managing Director of Shalivahana Green Energy Limited.
India suffers from serious power shortages, poor quality and reliability of supply, and inadequate access to power. The company plans to undertake small to medium-sized projects in the biomass, hydro, and wind-energy sectors. Eighty-percent of power generation in India comes from state-owned providers, with most private players focused on large thermal and hydro-power projects.
“Improving access to regular and clean power supply is a key strategic priority for IFC in India. Our Post-2012 Carbon Facility provides the Shalivahana Group with a high-quality revenue stream from CERs up to 2020 to strengthen the viability of their projects,” said Thomas Davenport, IFC Director for South Asia.
After the Indian government made adoption of renewable purchase obligations mandatory, state distribution utilities, open-access consumers, and captive power plants are required to buy a certain portion of their power purchases from renewable-energy sources.
About Shalivahana Green Energy Limited
Shalivahana Green Energy Limited is the flagship entity of the Shalivahana Group. The Group’s operations are primarily in power generation from non-conventional energy sources such as biomass and waste residue. Shalivahana Green Energy is one of the largest biomass power companies in India with a current capacity of 50.4 megawatts. Apart from IFC, Axis Infrastructure Fund 1 and IL&FS Renewable Energy Limited also invested in the company.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion. For more information, visit
www.ifc.org
.
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