Energy Efficiency Services Limited signs first long-term rupee loan for INR 500 crore

Energy Efficiency Services Limited (EESL), a joint venture of PSUs under the Union Ministry of Power has raised its first Long-term Rupee loan for INR 500 crores.

The loan, issued by Punjab National Bank (PNB), shall be utilized towards funding capital expenditure of Energy Efficiency Services Limited ’s flagship programmes including Street Lighting National Programme, Smart Meter National Programme, Solar Substation, and E-Mobility project.

The agreement for the seven-year loan was signed with a two-year moratorium, with the interest rate being linked to PNB’s Marginal Cost of Fund-Based Lending Rate (MCLR), presently at 8.45 percent per annum.

Speaking at the occasion, Saurabh Kumar, Managing Director, EESL stated: “This is a truly landmark moment in our company’s history, and holds much significance for the future of the energy efficiency market and overall EE ecosystem in India. Targeted at expanding the reach and impact of our energy efficient lighting, smart metering, renewable energy and electric vehicle programmes, this loan will also channel India’s capabilities towards leading the global charge against climate change from the front.”

The PNB loan is one of EESL’s several major financial ventures in 2018. In March, EESL and its UK subsidiary EnergyPro Assets Limited (EPAL) acquired Edina UK Ltd, a leading supplier, installer and maintenance provider for combined heat and power (CHP), gas, and diesel power generation solutions in the United Kingdom (UK). The INR 493 crore (£55 million) acquisition was the first-of-its-kind venture by an entity under the Ministry of Power, Government of India and was effected through EESL’s UK subsidiary, EPAL.

In May 2018, EESL also signed a loan agreement with The World Bank for INR 20.40 billion (USD 300 million) to scale up deployment of energy saving measures in residential and public sectors, strengthen EESL’s institutional capacity, and enhance EESL’s access to commercial financing with the first-ever IBRD guarantee in India.