International Solar Alliance says global facility to fund renewable energy projects to receive $35 mn
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The International Solar Alliance (ISA) on Tuesday announced that the Global Solar Facility (GSF), a payment guarantee fund formed by it to stimulate investments into solar power projects, is set to receive a capital contribution of $35 million.
The Indian government is considering a $25 million investment as capital contribution in the GSF in addition to $10 million coming from the ISA.
Bloomberg Philanthropies and CIFF have also committed their support to the GSF, which is designed to catalyse solar investments in underserved segments and geographies across Africa, unlocking commercial capital in the process.
Last year, the ISA Assembly had approved the GSF, which is expected to attract private capital to flow into off-grid solar projects, rooftop solar projects, and productive use solar projects.
This financing vehicle, bolstered by payment guarantees, insurance, and investment funds, aims to mitigate project risks, provide technical assistance to address regulatory gaps, reduce currency risks, and resolve contractual and financial uncertainties in the solar energy sector.
Minister for Power and New & Renewable Energy and ISA Assembly President, R.K. Singh, on Sunday said that the target for the GSF is to raise $100 million and that the aim going forward would be to globalise the GSF.
"Global Solar Facility aims to leverage investments to accelerate transition to solar energy. The target for the GSF is to raise $100 million. Africa has immense potential in deploying solar energy capacities, yet due to risks in investments, the region has not been able to leverage its potential. The GSF aims to address this challenge and provide security to investments. India is a good example of development due to private sector investments. It has no sovereign risks and has a strong legal and security framework with a dispute mechanism and security of payments, which has enabled India to attract investments. In the years to come, we will look at globalising the GSF. I invite all the Member Countries and organisations to partner with us in making this Facility a catalyst for the transformative change that we all are working towards," Singh said while addressing the sixth ISA Assembly, which was hosted by India.
