To meet the target of renewable energy production in the country, capital markets should be re-energised and renewables included in priority sector lending, bankers said here on Sunday.

They were speaking at a session on “Financing Renewable Energy: Success Strategies” at the first Renewable Energy Global Investors Meet.

“We also need credit enhancement bodies so that financing for such projects goes ahead,” said Naina Lal Kidwai, CEO and Country Head, HSBC India.

There is a need to bring renewable energy directly into households, said Yaduvendra Mathur, CMD, Export Import Bank of India.  He added that green bonds could help tap the financial bond market.

“To achieve tangible progress, housing developers should install renewable energy plants in projects, for which they can be given incentives such as subsidised funding and higher FSI,” said Sunita Sharma, MD and CEO, LIC Housing Finance Ltd.

Length of borrowing Sumant Sinha, CEO, ReNew Power, said one has to look at the length of borrowing as well. “We need to reduce the cost of debt financing if we want to bring down the cost of renewable energy,” he added.  The country could also look at a contingency fund apart from generation based tax incentives, he said.

Vivek Pathak, Regional Director-Asia Pacific, International Finance Corporation, stressed on the need to attract institutional investors for clean energy. “Apart from this, we need clarity in regulation and how to mitigate offtaker risk,” he added.

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