Azure Power Refinances 600 MW Bikaner Solar Project at Lowest Interest Rate in its Portfolio

India’s one of the leading independent power producers (IPP) Azure Power has refinanced its existing project finance facility of Rs 23.50 billion for the construction of a 600 MW Interstate Transmission System (ISTS) connected solar project in Bikaner, Rajasthan.

The state-owned Solar Energy Corporation of India (SECI) allocated project was implemented by the company’s Special Purpose Vehicle (SPV) ‘Azure Power Forty Three Pvt Ltd’, and was fully commissioned in December last year.

Also, the refinancing has been completed at a 7.2 per cent per annum interest rate, which is fixed for 42 months and the lowest rate of interest for any project finance facility in terms of rupee financing for the company’s existing portfolio so far.

Commenting on the significant development, Pawan Kumar Agrawal, Chief Financial Officer of Azure Power, said “refinancing the original term loan was one of our highest priorities, even before the project was fully commissioned in December 2021. The facility will result in substantial savings in interest cost and will improve the project IRR significantly. We are overwhelmed with the response we get from the credit markets which basically reflects lenders’ confidence in our strong corporate governance standards, operational capabilities, and credit fundamentals.”

Notably, this is the largest solar power project in India, owned and operated at a single location by any developer.

Besides, the power generated from the plant is being supplied to SECI at a tariff of Rs 2.53 per kWh under the Power Purchase Agreement (PPA) signed for 25 years.

Meanwhile, the project was commissioned in multiple phases, with the last 100 MW commissioned in December last year.