Yes Bank Limited (YBL) is in process of establishing its first ever private equity fund for clean energy. The South Asia Clean Energy Fund (SACEF) is hoping to raise $200 million by this summer. According to YBL they have already raised $125 million, even with the constraints of a global recession.
The fund is targeting renewable energy, energy efficiency and sanitation companies that are seeking between $7-10 million. Thus over the life of the fund it is expected that more than 20 companies would be recipients of equity funding.
Environment Energy and Enterprise Ventures Private Limited, e3V, is working with Yes Bank Limited to develop a practice within the bank to assist in the financing of ventures that directly or indirectly service the market for small-scale RE and/or EE ventures in rural and peri-urban parts of India. Their work is being funded by REEEP and YBL.
Investments in renewable energy are accelerating in several Indian states, in part due to recent announcements regarding renewable energy targets. The targets take the form of either megawatts installed or a fixed percentage of renewables in the energy mix.
For example, Gujarat announced a target of 500MW for the state and they’ve established a feed-in-tariff of US$ 0.27/kWh for a period of 12 years. This has attracted solar developers Astonfield and Refex energy, with 200MW and 50MW in solar projects respectively.
Rajasthan has announced $1.6 billion in renewable energy projects, most notably 1,600MW of wind farms awarded to Indian developer Suzlon. Hyrana is yet another state to come forward with a target, announcing a 10% renewables target and attracting $777 million in projects (250MW biomass, 440MW wind and 5MW small hydro).
India is well on its way to bringing online more than 3,000MW of renewables and hopefully Yes Bank’s new equity fund will allow even more projects to obtain the equity and debt required to finance clean energy.