Govt approves Rs5,000 crore tax-free bonds to support solar mission

Mumbai: The ministry of new and renewable energy (MNRE) has approved the sale of tax free-bonds worth Rs.5,000 crore to support the government’s solar mission.

Of this, the Indian Renewable Energy Development Agency (IREDA) is likely to raise Rs.2,000 crore through an issue of tax-free bonds in the next few months.

The announcement was made by Tarun Kapoor, MNRE joint secretary, in a speech at the Solar Power Summit-2015 in New Delhi on Friday.

IREDA is expected to use these funds to lend to solar energy developers at a lower interest rate of 10.5%. Developers, in turn, will use these loans to fund roof-top solar panel installations.

Kapoor also announced a withdrawal of subsidies extended on targets of non-conventional power generation for industrial and commercial purposes.

State-run NTPC Ltd is also soon expected to issue tenders for solar power projects of 15,000 megawatts, the PHD Chamber of Commerce said in a statement on Friday.

However, Kapoor acknowledged that public sector companies are not likely to add non-conventional power capacities in a big way. “The government would want the private sector to play a major role to lighten the India through solar power initiatives,” he said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.