Norway invests 300 million in Indian solar – E24
Norfund and the insurance company KLP are betting on solar energy in India. If this goes well, the development minister will open up the possibility of giving more money to the government’s newly established climate fund.
India is the world’s third largest emitter of greenhouse gases, and the need for green investment in the country is enormous.
Now Norfund, which is the state-owned Norwegian investment fund for developing countries, and the insurance company KLP are investing a total of NOK 300 million in a solar energy project in the country.
And it can be more.
Avoids emissions equivalent to 300,000 cars
Development Minister and owner of Norfund, Anne Beathe Tvinnereim (Sp), says she is proud of the investment.
– If we are to manage to get people out of poverty and prevent a climate disaster, we will have to spend the big money on countries like India which are switching directly to renewable energy.
Together, Norfund and KLP take a 49 percent stake in the Thar Suraya 1 project. The solar power plant is being built in the state of Rajasthan by Italian Enel Green Energy. When fully developed, the plant will be able to produce 750 gigawatt hours of electricity a year.
This is the second investment made through the Climate Investment Fund, which was established in May this year. The fund is owned by the government and managed by Norfund.
Norfund estimates that the project will avoid more than 615,000 tonnes of CO₂ emissions a year. This corresponds to annual emissions from 316,000 Norwegian petrol cars.
“Avoided emissions” is something different from “reduced emissions”. When you reduce emissions, you cut emissions that already exist. When emissions are avoided, it means that new energy production takes place with new green energy instead of new fossil energy.
– Accepts all the help we can get
According to the International Energy Agency (IEA), India is the country in the world that will have the greatest growth in energy demand going forward. It must be met with coal power or green power, depending on the level of ambition and investments.
Secretary of State in the Indian Ministry of Foreign Affairs, Meenakshi Lekhi, says that the Indian authorities are doing a great job of financing the green transition, but that they welcome all the help they can get from good friends.
– We welcome you, she says to Aftenposten/E24.
Lekhi took part in an event on Norwegian-Indian relations in Arendal on Wednesday.
There she points a clear finger at rich countries, which have been responsible for large historical emissions.
– Other countries must take responsibility for emissions they have had in the past, that is the moral right. We need funding and the exchange of technology, and we need to speed up that process, said Lekhi.
Huge need for funding
Every year, the world’s rich countries must provide USD 100 billion in climate finance to developing countries. It has committed to through the Paris Agreement. But the rich countries are far from this goal.
At the same time, a report from last year showed that India alone will need 3,500 billion dollars in foreign investment to achieve the goal of becoming climate neutral by 2070. This is estimated by the internationally recognized Indian think tank CEEW. The sum corresponds to the earnings of approximately three Norwegian oil funds.
Just to reach the goals for the development of wind and solar energy by 2030, the country will need a whopping 223 billion dollars in investments, the news agency Bloomberg calculates.
Great potential for investment
In comparison, the Norwegian climate fund, which was established in May this year, will invest NOK 10 billion over the next five years. It corresponds to approx. 1 billion dollars.
But the potential for further investments is great, the fund itself points out. Already this year, they estimate that they will be able to invest NOK 2.8 billion, and they have so far identified possible investments for NOK eight billion in eight countries.
– The needs are enormous and the opportunities to put the money to work are good, so we see that we will be able to quickly put to work the 10 billion that have been set aside for the climate investment fund over the next five years, says Tellef Thorleifsson, CEO of Norfund.
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Does not rule out increasing investments
Minister Tvinnereim, for his part, does not rule out the possibility of placing more money in the climate fund.
– If this continues to be as successful as we see the contours of it now, then it will be something I will take with me into the budget negotiations. But for now, I am delighted with 10 billion.
Searching for the most important investments, is to solve private investments.
KLP has invested together with Norfund in many projects and has a goal of increasing climate-friendly investments by at least NOK 6 billion each year. More and more people will see opportunities for green investments in developing countries.
– The smarter Norfund works with the projects, the easier it is to get hold of private capital.
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