US Export-Import Bank approves finance gurantee for Rel Power

US Export-Import Bank approves finance gurantee for Rel Power

New Delhi: US Export-Import Bank board that had earlier decided not to proceed with Reliance Power Ltd’s request for financing its 3960 MW Sasan ultra mega power project in Madhya Pradesh, approved a $917 million export finance guarantee for US exports to the project on Thursday. This will be used for sourcing mining equipment from Bucyrus International, Inc. and at its suppliers.

“The board’s approval of the Sasan power project resulted from carefully balancing the need to support American jobs and conventional energy exports, while simultaneously encouraging development of renewable energy facilities," bank chairman and president Fred P. Hochberg said in a release.

The bank’s decision of not to proceed in June was based on environmental concerns, post which Reliance-Anil Dhirubhai Ambani Group (R-Adag) owned company signed a memorandum of understanding (MOU) with the Bank for building a new 250 MW renewable energy project and complying with carbon emissions to 850 grams of CO2 per kilowatt hour for the coal based Sasan project.

“US Exim financing is a strong recognition of the fundamental strength of Sasan UMPP as well as power sector reforms taking place in India. Such facilities would assist in increasing diversity of potential lenders that would provide financing to Reliance Power’s projects, as well as reduce overall financing costs," said JP Chalasani, chief executive officer, RPL.

(Reliance Power has sued HT Media Ltd, publisher of Mint, in the Bombay high court over a 12 May front-page story in Mint that it disputed. HT Media is contesting the case.)