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India pushes for clean energy bank and credit guarantee fund

NEW DELHI : Energy Minister Raj Kumar Singh on Sunday called for a credit guarantee fund and a renewable energy bank to help countries switch from fossil fuels to clean energy.

Speaking during a roundtable with European Commission President Ursula von der Leyen and renewable energy companies at the International Solar Alliance headquarters in Gurugram, Singh said such a fund and a such bank are needed to stimulate investment in renewable energy installations in developing and underdeveloped countries. countries, including those in Africa. He also stressed the need to facilitate technology transfer to accelerate the energy transition.

“Governments around the world must come together to create a credit guarantee fund to invest in renewable energy, especially solar power in developing countries like those in Africa,” Singh said, adding, “It Also needed is an institution that can be called a ‘renewable energy bank’ for Africa.

The idea of ​​such a bank is gaining ground, with many countries struggling to finance themselves, given their poor sovereign ratings. Mint has previously reported a Global Solar Bank (WSB), which could be based in India, with the country as a core member with a 30% stake through a $600m equity commitment. Such a bank would be the first multilateral development bank (MDB) headquartered in India, with China taking the lead in establishing the Asian Infrastructure Investment Bank and the New Development Bank.

Singh added that countries should come together and work to make hydrogen fuel cells more efficient. The minister’s statement comes at a time when the government is trying to boost green hydrogen production and also popularize hydrogen fuel cell electric vehicles.

Von der Leyen said cooperation in the green hydrogen space is a hot topic in Europe, adding that India and the European Union are closely aligned in the fight against climate change. She said both countries are aware that solar energy will play a decisive role on the road to carbon neutrality.

Regarding the need to move faster towards renewable energy, the President of the European Commission said that in addition to thwarting climate change, Europe is also considering reducing imports from Russia and becoming self-sufficient. Von der Leyen is on a two-day visit for talks on key issues including the India-EU Free Trade Agreement (FTA) and the war in Ukraine.

“For us Europeans, this is a stark reminder that our reliance on Russian fossil fuels is unsustainable, because how can you do business with someone who openly threatens Europe and wages war on Europe. one of your closest neighbors, so our transition to local renewables is not only good for the environment, but also becomes a strategic investment in safety,” she said.

The Russian invasion of Ukraine in late February drew condemnation from the West, including the US and EU. Russia supplies the majority of Europe’s energy needs, and after the United States banned Russian oil and gas and announced a phase-out of imports by the United Kingdom, we are expects the EU to also consider banning energy imports from Moscow.

Countries dependent on energy imports, such as India, are striving to switch to hydrogen as a new-era, zero-emission fuel. Singh said that to move towards a hydrogen-based economy, fuel cell efficiency is key.

“We’re working on it; some fuel cells have been developed, and again that’s something the world needs to share. We need to come together and share the best technologies. If we just look at this from a business perspective , if we keep the best fuel cells with us, license them and charge huge royalties, then the pace of transition will not be fast enough,” he said.

Fuel cells can be used in a host of sectors such as energy transport and storage. Following the national hydrogen mission announced by Prime Minister Narendra Modi on August 15, the Ministry of Energy unveiled the first part of the new green hydrogen policy last February.

Singh also stressed the need for a comprehensive approach to tackling climate change and urged developed countries to contribute more to the clean energy transition. He said India had made huge strides in energy transition and added 163 GW of renewable energy by November 2021, despite the country’s per capita emissions being “one-third of the global average”.

“The problem facing the world is not something that can be solved by just one country, and it is not a problem that will be solved even if 10 or 20 countries reach net zero (carbon emissions). You can’t have a nationwide solution, but global and international solutions,” said Singh, who is also chairman of the ISA General Assembly.

This comes at a time when New Delhi plans to introduce a production-linked incentive scheme to encourage the manufacture of electrolyzers used to extract hydrogen from water, as Mint reported earlier.

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