Nearly 80 percent of India's population of 1.4 billion people still rely on coal, oil, and solid biomass—another combustible fuel—for their energy needs, making the South Asian economic powerhouse the world’s third-largest global emitter of greenhouse gases.
India has sought to address subsequent air pollution challenges and offset the use of coal-fired power by setting ambitious targets for half of its electricity requirements to come from renewable sources by 2030.
However, India currently relies heavily on imports to expand its capacity for solar-powered energy generation and the Indian market’s solar module demand right now outpaces domestic supply. The central government requires an additional 35GW of solar panel generation capacity installed annually, yet India as of 2023 has only 4GW of operational solar cell manufacturing capacity.
Solution and Impact
A $425 million loan from DFC to TP Solar Limited, a wholly owned subsidiary of Tata Power Renewable Energy Limited, will finance the construction and operation of a greenfield 4GW solar cell and 4GW solar module manufacturing facility in India. This investment will support India’s ambitious program to increase renewable energy generation while advancing the global energy transition to diversify supply.
DFC assesses that the loan will support the construction and operation of a solar manufacturing facility that, in turn, will contribute to India’s domestic production of solar panels, and support as many as 2,300 full-time local jobs, with an emphasis on employing women—TP Solar is committing that women will make up over 60 percent of its workforce over time.
TP Solar started the trial production of solar modules in late 2023 with an expectation to stabilize it by early 2024, to begin solar cell production in January 2024, and to stabilize production by April 2024.
This investment is only one part of DFC’s broader financing strategy to promote access to reliable energy that is cleaner, more sustainable, and more secure. DFC is investing in creating a more diverse supply chain for clean energy technologies that will help reduce price volatility and market risk while ensuring that countries around the world are positioned to take advantage of the massive investment opportunity that the clean energy transition represents.