MICROCAPITAL BRIEF: IREDA Loans $4m to Husk Power Systems for 140 Solar Microgrids in Rural India

The India Renewable Energy Development Agency (IREDA), a government entity, recently loaned INR 310 million (USD 4.2 million) to Husk Power Systems, an India-based supplier of small-scale electricity generation and distribution networks in rural India and Africa, to construct 140 solar microgrids in the Indian states of Bihar and Uttar Pradesh. IREDA is on-lending the funding from a line of credit from Germany’s KfW Development Bank.

Husk CEO Manoj Sinha said, “The IREDA financing demonstrates the government of India’s vision in making microgrids an integral part of its net-zero goal put forward at COP26 [the 26th UN Climate Change Conference of the Parties]. The IREDA funding will give Husk a much-needed boost to achieve our target of expanding our microgrid fleet 10 times by 2025.”

Founded in 2008, Husk has raised a total of USD 25 million over four rounds of funding since 2010. The firm’s investors include Shell Ventures, the Netherlands-based venture capital arm of energy firm Royal Dutch Shell; the Swedish government’s Swedfund International; and France-based venture capital fund Engie Rassembleurs d’Energies.

Established in 1987, IREDA provides financial assistance for projects related to renewable sources of energy and energy conservation. As of March 2021, IREDA reports total assets of INR 303 billion (USD 4.06 billion). The agency is controlled by India’s Ministry of New and Renewable Energy (MNRE).

KfW was founded in 1948 and is owned by the federal and local governments of Germany. As of December 2020, KfW held EUR 546 billion (USD 615 billion) in total assets and EUR 424 billion (USD 477 billion) in net loans and advances.

By Sheen Gupta, Research Associate

Sources and Additional Resources

Husk press release
https://huskpowersystems.com/husk-power-systems-secures-largest-ever-debt-finance-for-solar-microgrids-in-rural-india-receiving-us4-million-from-ireda-to-construct-140-microgrids/

Husk homepage
https://huskpowersystems.com/

IREDA homepage
https://www.ireda.in/home

IREDA 2021 annual report
https://www.ireda.in/annual-reports

KfW homepage
https://www.kfw.de

Previous MicroCapital article on Husk
https://www.microcapital.org/microcapital-brief-fmo-loans-5m-to-husk-power-systems-for-renewable-energy-generated-from-biofuels-distributed-via-minigrids-in-rural-india-tanzania/

Previous MicroCapital article on KfW https://www.microcapital.org/microcapital-brief-verdant-capital-hybrid-fund-closes-with-34m-from-kfw-to-invest-in-microfinance-sme-lenders-in-africa/

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