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Sun, 31 August 2014 13:11:41
Sri Lanka NDB mulls renewable energy project funding
26 Mar, 2012 09:57:42
Mar 26, 2012 (LBO) - National Development Bank said it is considering funding projects to generate energy from bio-mass, waste and solar having given loans to support hydro and wind power plants.
They were among several key sectors identified by NDB's project finance division for lending to support economic growth in post-war Sri Lanka, a statement said.

"We are committed to promoting key sectors of the economy that are considered of strategic importance to the overall socio-economic development objectives of the country,” said Russell de Mel, chief executive of NDB.

NDB has over the years funded projects in sectors such as energy, plantation, telecommunication, tourism, chemicals, and plastics and rubber-based industries.

"Reliable and uninterrupted power supply is a prerequisite for the development drive and rapid economic growth," it said.

"Renewable sources play an important role in energy generation in the back drop of escalating fossil fuel prices used in thermal power generation."

NDB as a development financier has so far funded 24 hydro power projects with a total capacity of 73 MW by providing loans to the value of over 2.5 billion rupees.

The bank was a party to the consortium of banks which funded the island's first wind power project.

The division has approved loans to a value of 1.5 billion rupees to the wind power sector which is considered a growing renewable energy source, it said.

"In addition to the hydro power and wind power sources presently available, NDB also initiated discussions during the last year for financing of other forms of renewable energy projects such as bio-mass energy, waste to energy and solar energy, which are new to the country."

The division played a lead role in arranging finance for a 9.8 MW wind power plant in north-western Kalpitiya along with two other banks.

NDB said it has a "significant" commitment in the project by way of term loans and investment in equity through its group companies.

NDB also approved a loan of 10 million US dollars to take part in a syndicated debt facility arranged by its investment banking arm, NDBIB, for a power project in Bangladesh.

"This has created an opportunity for the bank to partner with its long standing clients to expand their business to the South Asian region as well," the statement said.

The bank said it is also funding hotel projects in the north and east regions which are reviving after the end of the 30-year ethnic war in 2009.

These include a 3-star hotel with 26 rooms, a diving school and swimming pool and a 5-star hotel with 50 luxury rooms in Passekudah in the east.

NDB is also planning to finance three more hotel projects in the Kalutara, Chilaw and northern Jaffna areas.

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