Power Finance Corporation (PFC) of India to form subsidiary to focus on renewable energy projects

PFC was set up in July 1986 as a Financial Institution (FI) dedicated to Power Sector financing and committed to the integrated development of the power and associated sectors.

PFC occupies a niche position as a provider of finance exclusively focused on the Indian power sector. PFC is Rated Baa3/BBB-/BBB- by Moody’s,S&P and Fitch respectively; ratings are at par with Indian sovereign rating.

The Corporation was registered as a Non Banking Financial Company by RBI and has been conferred with the status of Nav-Ratna PSU by Govt. of India on 22nd June, 2007.

PFC, usually undertakes financing of projects of capacity in excess of 100Mw. A couple of days back, PFC announced plans to form a subsidiary which will exclusively focus on renewable energy.

This is a great move, as thermal power projects achieve financial closure rather easily once they become eligible for the same, though that might be a challenge.

Renewable energy is still facing challenges in funding, including wind and solar.  A slew of projects in Solar PV and thermal will be announced and finalized  on Tuesday, the last day of submission of RfP for the solar mission and the opening of the bids for the same.

This will bring a lot of utility scale projects that will face challenging time lines for financial closure over the next few months  and project execution dead lines.

Panchabuta, will keep a close watch on the developments in this space and work to serve as a platform to provide entrepreneurs and developers with all possible opportunities available for funding in India.