SunBorne Energy, a utility scale solar solutions, and Suntech Power Holdings Co., Ltd. (NYSE: STP), the world’s largest producer of solar panels, entered into a framework agreement for the supply of 100MW of solar panels over the next two years for projects in India.
Suntech will supply 280Wp polycrystalline silicon modules for projects that will be designed, installed and commissioned by SunBorne Energy. The agreement includes an initial order for 10MW of solar panels for a project in Gujarat, India.
According to reports, SunBorne Energy Technologies, a solar power developer backed by billionaire Vinod Khosla, is close to arranging 1.5 billion rupees ($34 million) in loans from three banks for its first plant in India.
SBI Capital Markets Ltd., a unit of India’s largest lender, is arranging the deal, SunBorne Chief Operating Officer Gagan Vermani said today by telephone.
“We already have a sanction letter from one bank and two more are in the pipeline,” Vermani said. “For all practical terms, we’ve closed.” Vermani declined to name the banks.
Solar projects in the country facing a government deadline to build 1.1 gigawatt of capacity by the year’s end are racing to secure financing. Banks have expressed concerns about lending to the new sector, including worries that solar equipment may not perform as expected under Indian climactic conditions which would affect projects’ ability to produce enough power to pay back loans.
“There’s only seven to eight months left to put up that 1.1 gigawatt,” Vermani said. “We don’t see most of that happening.”
As projects get delayed to next year, Sunborne expects a surge in contracts to design and build projects for other developers in 2012, he said.