REC Ltd, which finances and promotes power projects across India, has been gearing up for a big shift by focusing on renewable energy and other green projects. With the shift in priorities towards renewable energy, raising funds for renewables has become easier in the domestic and global market, says Vijay Kumar Singh, Director (Projects), REC Ltd. Stating that green hydrogen is a promising sector, he explains, in this interview, how policy-led reforms have improved the health of the power sector.
How does REC raise its funds? Has access to global funds become easier, especially for green projects?
REC aims to maintain a diversified mix of borrowing from different sources and geographies and the final decision to raise from a particular source depends upon the all-in landed cost at the time of raising funds. Indicatively, REC may continue to raise around $ 2-4 billion annually from international markets through a mix of Foreign Currency Bonds and Term Loans and the remaining from the domestic market. As far as domestic market rates are concerned, what we understand from the Reserve Bank of India’s (RBI) commentary is that the inflation fears have largely receded and accordingly, future rate hikes may be lower or nil.