Prominent development expert Auroville Consulting has published a report on the current state of grid funding for Tamil Nadu, considering the introduction of global debt by various State banks.
According to the report, state-owned banks such as State Bank of India (SBI) and Punjab National Bank (PNB) are more profitable than the Indian Renewable Energy Development Agency (IREDA) as they have branches across the state, including rural areas.
On the other hand, IREDA, as a company committed to promoting the renewable energy sector, has the potential to secure significant Government and international development funding for this specific purpose. However, its current financial limit with a small loan amount of INR 50 lakh attracts large projects; although it is currently making efforts to re-install solar production on a smaller roof.
Given the broader reach of public sector banks, the report proposes to increase the number of branches equipped to deal with solar subsidies to improve the availability of these low-cost financial institutions.
According to the report, SBI, PNB, IREDA, Syndicate Bank, and Indian Bank have a dedicated roofing scheme in Tamil Nadu.
Syndicate Bank offers solar roofs under categories such as syndicate Bank mortgage loan, Syndicate Bank corporate loan, and Syndicate Bank Personal Loan, making it difficult to track their progress.
The Auroville report proposes the construction of a window or section dedicated to addressing this issue.
Other challenges identified by the Auroville study are lack of consumer awareness of financial benefits, access to finance under the right types of business, lack of strong communication between stakeholders, and the skills and knowledge required of stakeholders such as government respected agencies, Electricity Regulatory Commissions and funding agencies, resources.
While these issues are still being addressed through technical assistance programs, market development strategies, and marketing campaigns, the report emphasizes the need to link information, skills, and skills gaps to banks to deal with day-to-day lending.
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