US Ex-Im backs Indian energy plant

The Export-Import Bank of the United States (US Ex-Im) could sign loan guarantees worth US$600mn for suppliers of Reliance Power’s coal-fired power project and mine in Central India pending financial, technical and environmental review.

US Ex-Im had originally rejected a request from India’s Reliance Power on environmental grounds but reversed its decision after US congressman Jim Sensenbrenner led a protest against the bank’s decision.

Sensenbrenner claimed that the loan guarantees would equate to around 1,000 new jobs being created in Milwaukee, Wisconsin, where Bucyrus International, the company who will be providing most of the equipment for the project, is based.

“I’m glad that the US Export-Import Bank reversed its decision and extended loan guarantees,” Sensenbrenner remarks, “but we shouldn’t let the reversal obscure the bad policy that led to it.”

However, US Ex-Im’s president and chairman Fred Hochberg has suggested that the reversal of policy only came after the bank reviewed Reliance Power’s renewable energy projects and policies, which US Ex-Im now feels sufficiently offsets the carbon output of the new development: “We are pleased that Reliance is making this commitment to renewable energy. This transaction was also made possible because of Anil Ambani’s leadership and vision in diversifying Reliance Power’s production portfolio of energy projects in India,” Hochberg comments.

The new development, which will be built in Central India’s Madhya Pradesh state, will produce 3,960MW of energy and is projected to produce up to 27,000 tonnes of carbon dioxide a year.