International Solar Alliance to set up $300 bn fund

International Solar Alliance to set up $300 bn fund

The International Solar Alliance (ISA) is proposing(प्रस्ताव) to set up a $300 billion fund to support clean energy projects in member countries over the next 10 years. "The proposal is to strive(प्रयास करते हैं)  for 300 billion dollar global fund over 10 year with contributions(योगदान) from the World Bank ... and also from Green Climate Fund to leverage $3,000 billion investment from the corporate sector for meeting investment requirement for solar energy programmes and projects in ISA member countries for the next 10 years," ISA interim Director General Upendra Tripathy told reporters here.  The ISA is an alliance of more than 120 countries.

The allocation(आवंटन) will be notional and will only be backed with 20 per cent of the amount being budgeted. The risk guarantee premium may be 0.8 to 1 per cent and the World Bank may administer it as a commercial(व्यावसायिक)  project, Tripathy said. "We are thinking of creating over a period of 10 years 300 billion dollar fund. 300 billion dollar is a big number," he said. "The idea of ISA is not to ask for cheques not to tell them to deposit money. This...is the cheque of assurance, of commitment, that if somebody has taken the assurance(विश्वास) and the claim comes then only you have to settle it...this will attract capital into this sector in the ratio of 1:10."

ISA was launched in November 30, 2015, as a coalition of solar resource rich countries jointly by Indian Prime Minister Narendra Modi and French President Francois Hollande in the presence of the then UN Secretary General Ban Ki Moon on the first day of the Paris Climate Conference or CoP21.

"If we put one dollar in insurance 10 dollar will come by way of investment. If we put 300 billion dollar, 3000 billion dollar will come," he said.

India is also examining allocating a line of credit of $1 billion for non-African ISA member countries.

It is on the lines of a $2 billion line of credit being operated by the Ministry of External Affairs in Africa for solar projects in countries that have signed and ratified the ISA treaty.

The ISA along with France and India is proposing to launch a programme for solar mini grids in the near future.

Indian firms have submitted expression of interest for setting up of mini grids equivalent to 78 mw in partnering African countries under India's soft loan related schemes for the continent.

The ISA has also proposed setting up a mechanism to lower the risk involved in financing of solar projects.

"The ISA programme, 'Affordable Finance at Scale', launched in April 2016 offers as its action point to set the ground for establishment of Common Risk Mitigating Mechanism," Tripathy said. 

KEY INFORMATION ABOUT INTERNATIONAL SOLAR ALLIANCE

Financial Structures for Solar Energy There is no specific body in place to address the specific solar technology deployment needs of the solar resource rich countries located between the Tropic of Cancer and the Tropic of Capricorn. Most of these countries are geographically located for optimal absorption of the sun’s rays. There is a great amount of sunlight year-round which can lead to cost effective solar power and other end useswith high insolation of almost 300 sunny days in a year. Most of the countries have large agrarian populations. Many countries face gaps in the potential solar energy manufacturing eco-system. Absence of universal energy access, energy equity and affordability are issues common to most of the solar resource rich countries.

International Solar Alliance (ISA) is conceived as a coalition of solar resource rich countries to address their special energy needs and will provide a platform to collaborate on addressing the identified gaps through a common, agreed approach. It will not duplicate or replicate the efforts that others (like International Renewable Energy Agency (IRENA), Renewable Energy and Energy Efficiency Partnership(REEEP), International Energy Agency (IEA), Renewable Energy Policy Network for the 21st Century (REN21), United Nations bodies, bilateral organizations etc.) are currently engaged in, but will establish networks and develop synergies with them and supplement their efforts in a sustainable and focused manner.