IDFC
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Electricity Generation

We believe there are significant opportunities in the energy sector due to the need for additional generation transmission and distribution capacity by public and private sectors. The government aims to add over 78,000 megawatts of generation capacity by 2012. The capacity addition in 2009-10 was 9585 megawatts, the highest ever, of which 45% of the capacity was added by the private sector.

Moving ahead, the private sector is expected to not only meet its target capacity addition but exceed it. The mid-term appraisal of the 11th Plan indicates that as against a target of 15,000 megawatts, the private sector will be adding close to 20,000 megawatts.

All these factors together have created opportunities for infrastructure development, especially in the captive power plant development segment. Our electricity generation business focuses on financing captive power plant projects, small and medium sized hydro-electric projects and certain coal and gas-based independent power producers.

While thermal power remains the dominant area, we are also pursuing hydro-electric projects. Renewable energy generation is another area where we are actively partnering players in the wind energy space.

Some of our key projects in this segment include

  • Financial advisory and lead arranger for a 1,110 megawatt liquefied natural gas (LNG) based combined cycle power plant in Gujarat.
  • One of the main lenders for the 1,150 kilometer transmission project between Tala and Delhi which is the only private sector transmission project in India.
  • Financing of several major private distribution licensees in Delhi, Ahmedabad, Surat and Mumbai.
  • Principal equity investments in leading companies in this sector.
  • We are also in the process of negotiating terms of financing for UMTPs aggregating line length of 2,100 km.
 

Utilities

At IDFC Project Finance, we provide financing support to the capital expenditure and efficiency improvement program of private sector distribution utilities with strong financials. With the government laying emphasis on the improvement of utilities in the near future, we believe that there are significant opportunities in this segment.

We are the lead financial institution for

  • A 1,005 MW coal fired power plant in Orissa
  • Two 135 MW multi-fuel fired power plants in Gujarat

Renewable Energy

We are committed to sustainable development and are actively involved in financing renewable power projects in India. At IDFC Project Finance, we conduct our own environmental due diligence for all projects financed, and are a member of United Nations Global Compact, a global strategic policy initiative for sustainable and ethical business practices.

Renewable Energy holds the potential to establish India as the manufacturing hub for solar power and encourage innovation in technology. The development of a successful cost-effective technology to harness this potential could result in a long-term sustainable solution for meeting the country's energy needs.

Some other initiatives by the government to promote Renewable Energy include fiscal incentives in the Union Budget for FY 2010-11 and the creation of a National Clean Energy Fund (NCEF) for funding research and innovative projects in clean energy technologies.


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