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New & Renewable Energy

PRESENTATION By

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Agenda I

Energy Scenario

Power Reforms

RE Imperative

RE Scenario RE Policy Enablers

RE Targets

RE Investments Attractiveness

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Energy Scenario Power Capacity 156 GW

Thermal - 100 GW

Hydro - 37 GW

Renewable - 15 GW

Per Capita Consumption

730 units RE Share in Generation 4%

Energy Served Population 60%

Peak Deficit 12%

Energy Deficit 11%

AT&C Losses 30%

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Power Reforms Unbundling of utilities

De-licensing in Generation & Transmission

Mega schemes - UMPP & UMTP

Creation of National Grid

Franchisee in Distribution Promoting merchant Power

Focused approach for Rural Areas

Promotion of Renewable Energy Fiscal & Financial Incentives

RPO Targets

National Solar Mission

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RE Imperative

Enormous RE potential Promotes Energy Security

Promotes Sustainable Growth

Bridges demand-supply gap

Reduced Losses as Generation nearconsumption

Provides lifeline energy (Heat, Light &

Power) to rural masses

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Issues with RE Projects Remote Locations

Infirm Power, difficult to schedule

Limited Generation period, requires storage

High Generation Cost due to

High up-front cost Low Capacity Factor

Under-utilization of transmission facilities

Associated with Reactive Power

First Generation Entrepreneurs Limited Public Sector Participation

Lack of Trained Work-force

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RE Policy Enablers Dedicated Ministry MNRE

Dedicated Financial Institution - IREDA

Comprehensive Resource Assessment Wind Atlas

Solar Radiation Mapping Identification of Hydro sites

Enabling Legislations NAPCC

Purchase Obligations Preferential Tariffs/ GBI/ RE Certificate

Guaranteed off-take, Must-Run status

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Fiscal & Financial Incentives

Excise duty exemptions

Income Tax Holiday

Accelerated Depreciation

Electricity Duty exemption

Preferential Tariffs/ GBI/ RE Certificate

Interest & Capital subsidies

100% FDI permitted

Energy buy-back through long-term PPA

Captive, 3rd Party Sale & Trading

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NAPCC Snapshot 8 Missions

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Indian RE Scenario

SectorTotal Potential

(in GW)Harnessed

(in GW)

Wind 48 11

Small Hydro 15 2.6Cogeneration 5 1.2

Biomass 17 0.8

Solar Unlimited 6

Note: Grid connected capacity as on 31-Oct-2009

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Investments in Indian REParameters 2007 2008 % Change

Total Investments USD 3.3 Bln USD 3.7 Bln 12%

SOURCE-WISE

VC & PE USD 133 Mln USD 493 Mln 280%

Foreign Exchanges USD 756 Mln -- --

Domestic Bourses USD 646 Mln USD 74 Mln (85%)M&A USD 585 Mln USD 585 Mln --

SECTOR-WISE

Wind USD 2.2 Bln USD 2.6 Bln 17%

Solar USD 18 Mln USD 347 Mln 1800%

SHP USD 135 Mln USD 543 Mln 300%

Bio-Fuel USD 251 Mln USD 49 Mln (80%)

Asset Finance USD 2.5 Bln USD 3.2 Bln 25%

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2012 RE Targets & Investments

Sector Capacity*

(MW)

USD Mln

per MW

Investments

USD BlnWind 6250 1.1 7

Solar** 1000 3 3

Small Hydro 860 1.4 1.2

Biomass 1380 1.00 1.3

TOTAL 9500 12.5

By 2012 25000

(*) After deducting for the commissioned capacity as on31 Oct09 from MNRE-RFD for Wind, SHP & Biomass

(**) Solar JNNSM (Th-600 MW + PV-400 MW)

(^) Cost projections Inline with CERC guidelines

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ATTRACTIVE INVESTMENTDESTINATION

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Indian Economy

Fastest growing free marketdemocracy

4th largest economy

GDP growth @ 8%

Infrastructure 2nd largest Rail network

334 airports

12 major ports & 87 minor ports

400 Million telephone connections

5th largest power market

IT & Engineering Superpower

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FDI in India

100% FDI allowed in powerGeneration, Transmission &Distribution

Government has set up ForeignInvestment ImplementationAuthority

One-stop service to foreign investors

Obtaining necessary approvals Sorting operational problems

www.investinginindia.in

http://www.investinginindia.in/http://www.investinginindia.in/http://www.investinginindia.in/http://www.investinginindia.in/http://www.investinginindia.in/http://www.investinginindia.in/

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Source: IBM-PLI Global Investment Locations Database, GILD

INDIA: Ideal DestinationBusiness

India

USA

UK

China

Financial

USA

China

UK

India

Motor

China

USA

India

Poland

ICT

India

USA

ChinaUK

Electronics

China

India

USAUK

Pharma

USA

China

IndiaUK

US$ 35Billion FDI in

2008-09

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FDI in Indian Power Sector

YearPower Sector

(US $ Mln)RE Sector(US $ Mln)

2008-09 985 852007-08 968 43

2006-07 158 2

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ABOUT IREDA

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Agenda II

Introduction Operational Areas

Financing Schemes

Resource Base Performance Highlights

International Partnerships

Recognition

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Evolution

INCEPTIONIncorporated under the Companies Act on 11th March,1987 to promote, develop and extend financialassistance for Renewable Energy and EnergyEfficiency/ Conservation Projects.

OBJECTIVEExtend financial support to Renewable Energy, Energy

Efficiency & Conservation projects

MOTTOEnergy For Ever

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OperationalAreasSectors being financed: Wind Small & Medium Hydro Biomass Power & Cogeneration Solar

Waste to Energy EE & Conservation Bio Fuels/ Alternate Fuels

Other Activities Intermediary for providing financing

facilities for various MNRE Schemes Implementing Agency for GBI scheme

http://www.originenergy.com.au/files/ClydeHydroPowerStation_update3.jpghttp://images.google.co.in/imgres?imgurl=http://www.tfot.info/upload/items_icons/Repower-5M-wind-turbine_large.jpg&imgrefurl=http://thefutureofthings.com/pod/1096/repower-5m-largest-wind-turbine.html&h=768&w=1024&sz=136&hl=en&start=52&usg=__iOWpjRaGa8icIpBm94AMDxzLu_0=&tbnid=-1Ja7LeX2l_NdM:&tbnh=113&tbnw=150&prev=/images%3Fq%3Dwind%2Bturbine%26start%3D40%26gbv%3D2%26ndsp%3D20%26hl%3Den%26sa%3DN

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Financing Offerings

Schemes Project Financing Equipment Financing Financing Through Intermediaries

Terms Loan - 70% of Project Cost Interest -11.25% to 12.15%

(based on credit rating) Repayment - Upto 13 Years

New Initiatives Securitization against future receivables

Structured repayment Loan syndication under Consortium Non-recourse financing

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Outreach

Registered & Head office New Delhi

Branch Offices Chennai & Hyderabad

Camp Offices Kolkata & Ahmedabad

Business Development Associates 50 Nos MoU with PFC, PTC, IIFCL for joint financing

Conducts Business Meets, Seminars,workshops

Publishes IREDA News & Bulletin on EE

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Cumulative Performance No of Projects Sanctioned :1892

Total Loan Sanctions :Rs.10,356 Cr

Loan Disbursements :Rs. 5,754 Cr

Sanctioned Power Capacity :3616 MW Commissioned Capacity :1902 MW

Conventional Fuel Replacement :13L MTCR/Yr

As on 31/03/2009

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India RE PortfolioIREDA Share

As on 31/03/2009

SectorTotalMW

IREDAMW % Share

Bio-Power 703.0 224.8 32.0%

Wind 10242.0 907.9 8.9%

SHP 2428.8 300.0 12.4%Co-Gen 1049.0 494.6 47.1%

W2E 59.0 24.7 41.8%

Solar 2.9 NIL NIL

TOTAL 14484.7 1951.9 13.5%

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International PartnershipsLines of Credit Availed Govt of Netherlands, 1991 :18 Million Dutch Guilders World Bank (1st LoC), 1993 :$ 145 Million DANIDA, 1993 :$ 15 Million Asian Development Bank, 1997 :$ 100 Million KfW, Germany (1st LoC), 1999 : 61 Million

World Bank (2nd

LoC), 2001 :$ 110 Million KfW, Germany(2nd LoC), 2008 : 50 Million KfW, Germany (3rd LoC) : 19.9 Million

Lines of Credit in Pipeline AFD (France) : 70 Million JICA (Japan) :$ 100 Million

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Lenders Perceptions

ADB - IREDA has satisfactorily performed the operationaland institutional responsibilities in accordance with thediverse objectives for which it was created.

World Bank - IREDA is well motivated, active and hasstrong interest in incorporating environmental costs andbenefits into economic analysis.

KFW - despite its fairly young age, IREDA is an able andcompetent financial institution and has retained its financial

strength through years of very rapid growth and in sectorswith considerable technological and financial risks.

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Recognition

Second Prize in Water

Globe Award Category ofthe Energy Award 2002presented at Linz,Austria.

World ClimateTechnology Award for theyear 1999 by ClimateTechnology Initiative(CTI), France.

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THANK YOU