Financial Instruments to Address Renewable Energy Project Risks in India

This paper provides a summary of financial instruments to address two biggest risks renewable projects in India. These include the following: first, off-taker (or counterparty) risk, which relates payment delays by public-sector distribution companies independent power producers, then impact project level cash flows domestic currency; second, currency foreign exchange) risk related fluctuations, investor currencies. describes multiple solutions for each these risks, using public funding mechanisms. For delays, category is termed Payment Security Mechanisms; whereas, Foreign Exchange Hedging Facilities. The coverage this shows evolution from theory practice over time. are likely be applicable other developing countries.