Tata Cleantech Raises ₹1,800 Million from Netherland’s FMO through Green Bonds

The funds will be utilized to grow Tata Cleantech’s renewable energy portfolio


Tata Cleantech Capital Limited (TCCL) has raised ₹1,800 million (~$25.62 million) through green bonds from FMO, the Netherlands Development Finance Company.

Tata Cleantech is a part of Tata Group in which Tata Capital holds 80.5 percent of share and the International Finance Corporation (IFC) holds 19.5 percent of share. The company started its business back in 2013.

The funds will be utilized to grow Tata Cleantech’s renewable energy portfolio. The company mainly focuses on renewable energy, energy efficiency, and water management. This funding would also help FMO reach its long-term emission reduction targets.

Tata Cleantech’s portfolio mainly consists of large project finance investments in renewable energy sectors like wind and solar. It is also involved in power transmissions and small hydro plants.

FMO has classified TCCL in environmental and social (E&S) risk Category A. The main issues faced by solar projects are land procurement, long term restriction on vegetation growth, and enhancing existing water stress for the local communities. Similarly, in wind projects, the main E&S issues are bird or bat collisions, shadow flickering, and soil erosion along slopes for projects in hilly terrain.

In January 2018, the FMO provided $4 million (~₹254 million) in equity funding to Orb Energy to expand its in-house finance facility of rooftop solar projects for Small- and Medium-sized Enterprises (SMEs) in India and Kenya.

Earlier, Yes Bank, FMO, DEG (the development bank of Germany) and Proparco (the development of France) signed a Green Finance Charter for green finance in India. Through the charter, the four banks committed to mobilize green investments, seize opportunities in India’s sunrise sectors, and contribute to achieving India’s Nationally Determined Contribution (NDC) and Sustainable Development Goals (SDG) targets towards climate change.