Industries in Andhra Pradesh can now easily avail bank finance to take up energy efficiency projects. Bureau of Energy Efficiency (BEE) has come forward to channelize bank finance to the energy efficiency projects in various states under Partial Risk Guarantee Fund for Energy Efficiency (PRGFEE) scheme.
The energy efficiency projects will be provided loan up to Rs 10 crore through BEE approved energy service companies (ESCOs). BEE has formulated a risk sharing mechanism to provide financial institutions with a partial coverage of risk involved in extending loans for energy efficient projects. They have allotted around Rs 312 crore for the PRGFEE at the national level. Under the scheme, BEE will provide guarantees a maximum 50% of the loan or Rs 10 crore per project, whichever is less, to the financial institutions which offer loans to industries or others to take up energy efficiency projects in Andhra Pradesh.
In case of default, the fund will cover the first loss subject to maximum of 10% of the total guaranteed amount and cover the remaining default amount on pari-passu (equal footing) basis up to the maximum guaranteed amount.
