USAID to catalyse $100 m to promote clean energy in India
Washington: The US Sunday said it will facilitate USD 100 million investment for India's burgeoning clean energy sector and help the country's transition to a low carbon economy and open-up new development opportunities.
The US Agency for International Development (USAID) said that it will partner with US-based institutional investor Northern Lights Capital Group to facilitate the investment via Nereus Capital.
The announcement came as Secretary of State John Kerry arrived in India to participate in the fourth annual US-India Strategic Dialogue.
This investment, through the Agency's Development Credit Authority, is expected to create hundreds of additional megawatts of sustainable energy capacity and will help to advance India's clean energy industry, the agency said in a statement.
The partnership is the first time in the Agency’s history that it has partnered with a private investment fund to facilitate targeted investment.
USAID will provide a 40 percent credit guarantee for a USD 100 million limited partner commitment to Nereus Capital’s India Alternative Energy Fund managed by Northern Lights Capital Group, an institutional investor.
"USAID will be able to dramatically leverage large scale funding to help India's transition to a low carbon economy and open-up new development opportunities for enhanced energy access," said USAID Administrator Raj Shah.
"This investment could eventually create as much as 300-400 additional megawatts of sustainable energy capacity, which is equivalent to lighting the homes of tens of thousands of Indian families.
"And as our first investment in a private investment fund, it will help to facilitate access for US entrepreneurs to this important emerging market."
In order to meet latent demand and address energy shortfalls, the India government has set a target of 30,000 megawatts of renewable energy generation capacity in the next five years.
"The Development Credit Authority's loan guarantee will allow USAID to catalyse and leverage private sector investment for greater impact and scale," said Ben Hubbard, the Director of USAID’s Development Credit Authority.