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10_IREDA Financing Scheme

The IREDA Financing Scheme aims to provide financial assistance for the establishment of facilities to manufacture Biomass Pellets, Briquettes, and RDF, promoting sustainable processing of agricultural residues and municipal solid waste. Eligible entities can receive loans starting from Rs. 50 Lakh, with varying percentages of project costs covered based on the total project cost. The scheme includes specific terms regarding interest rates, repayment periods, securities, and general conditions for project viability.

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Renu Sarath Vegesna
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15 views

10_IREDA Financing Scheme

The IREDA Financing Scheme aims to provide financial assistance for the establishment of facilities to manufacture Biomass Pellets, Briquettes, and RDF, promoting sustainable processing of agricultural residues and municipal solid waste. Eligible entities can receive loans starting from Rs. 50 Lakh, with varying percentages of project costs covered based on the total project cost. The scheme includes specific terms regarding interest rates, repayment periods, securities, and general conditions for project viability.

Uploaded by

Renu Sarath Vegesna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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IREDA Financing Scheme - “Manufacturing of Biomass Pellets / Briquettes/Torrefied Pellets/

Refuse Derived Fuels (RDF)”

I. Scheme Objective:

To provide financial assistance for setting up of facilities for manufacture of Biomass Pellets
/ Briquette/RDF, which in turn promote processing of agriculture crop residues/MSW in an
economic way and support sustainable environment.

II. Eligible Entities: As per Financing Norms of IREDA


III. Projects E l i g i b l e f o r t h e A s s i s t a n c e ; All the commercially viable Biomass
pellets / Torrefied Pellets/Briquette/ RDF manufacturing plants.

IV. Minimum Loan

The minimum loan eligibility from IREDA will be Rs.50 Lakh


V. Promoter Contribution and Quantum of Loan

• Quantum of loan from IREDA shall be linked to the project cost and is as per the
following table:
Project cost Loan Amount as % of project cost
If the project cost is upto Rs. 5 Cr Upto 70%
More than Rs. 5 cr & upto Rs. 10 cr Upto 60%
More than Rs. 10 Cr Upto 50%

• The minimum promoter contribution shall be 30% of the project cost.

VI. Interest Rate: - The applicable interest rate will vary & depends on the grade of
the of the project, as per IREDA Credit Risk Rating system (CRRS), as applicable to
Biomass Power projects
Note:
• The interest rates are revised from time to time, as per IREDA’s internal process
through interest rate fixation committee
• Interest rates prevailing at the time of each disbursement shall apply

VII. Repayment Period & Moratorium: - The repayment period shall be maximum
of 6 years, depending on the project cash flows & DSCR of the project and it shall
be after the implementation & moratorium period. The moratorium period
shall be upto 12 months from the date for COD of the project.
VIII. Securities:

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• Company shall provide exclusive charge or pari passu charge in case of co-financing,
by way of equitable mortgage and on plant & machinery by way of hypothecation of
movable assets of the project.
• Pledge of shares (minimum 51%) of the applicant company.
• One or more additional securities such as mortgage of Collateral security, Corporate
and/or Personal Guarantees, 3rd party Guarantee, Deposit of PDCs, Demand
Promissory Note, BG/FDR for not less than 10% of loan etc., may be provided to the
satisfaction of IREDA.
• Revenue from sale of pellets / briquettes/RDF, if any should be routed through TRA
and provide exclusive charge on Trust & Retention account (TRA). Further, in place of
exclusive charge, the Sharing on pari-passu charge in case of Co-financing may be
allowed.

IX. Any other security, as may be feasible.

X. Fees and charges: As per Financing guidelines of IREDA

XI. General Conditions

• All the commercially viable Biomass pellets/Torrefied Pellets/ Briquette/ RDF


manufacturing plants.
• The site specific Biomass resource availability/ Survey Reports report to be provided.
• Market Survey reports indicating the potential buyers of Pellets/ Briquettes around
the site.
• The borrower shall provide all information and documents reasonably required
in connection with the procurement, of any goods, services and works to be financed
by IREDA, as per the established commercial practices
• The subsidy/grant, if any given by the Central Government/ State Governments shall
be adjusted against loan sanctioned by IREDA.
• The interest subvention/interest subsidy, if any given by State/Central Govt., will be
passed on to the project.
• Other terms and conditions shall be as per prevailing Financing Norms/ Guidelines of
IREDA.

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