Anil Ambani group company Reliance Power has tied up funds for its 40 MW solar power project,with loans worth Rs 525 crore coming from the Asian Development Bank and the US Exim Bank. The plant,coming up at Jaisalmer district in Rajasthan,would also be the first Indian power project to get financing from only global lenders,sources said. The project - India's largest solar PV initiative -entails a total capital cost of about Rs 700 crore to be financed at a debt-equity ratio of 75:25. Sources said Reliance Power would pump in Rs 175 crore into the project. "US Exim Bank's portion in the total debt would account for Rs 304 crore,whereas ADB would provide financial assistance of Rs 221 crore," they said. According to sources,this is the first sanction by ADB as a direct loan to a private sector solar project in India. Confirming the development,Reliance Power CEO J P Chalasani said this is the first solar power project to achieve the financial closure with global lenders only,resulting in substantial savings. "This financing also re-affirms the long term relationship between Reliance Power and prestigious global lenders like ADB and US Exim bank,who are willing to provide financing to our projects even in the current challenging global environment". The foreign financing route would result in significant savings for the company since overseas loans have a tenure of 18 years with lending rates of 3-4 per cent. On the other hand,loans from Indian banks generally have a tenure of 13 years and lending rate close to 13.5 per cent. The project is scheduled for commissioning in 2012. The long term Power Purchase Agreement (PPA) for PV project has been signed with Reliance Infrastructure. Solar panels for the project would be imported from US-based First Solar.
