PTC to set up $1 billion fund for power projects
PTC India, the country’s largest electricity trading company, is putting together plans to set up a $1-billion offshore fund to finance power projects in India. The public-private partnership company is already in talks with Goldman Sachs, Macquarie, Blackstone and Soloman Brothers, among other global players. PTC aims to set up the fund within the next six months.
With its existing non-banking financial company, PTC Financial Services (PFS), the company has gained expertise in providing financial services support for power generation projects. The company plans to seek seek board approval once it formally receives expressions of interest (EoIs) from various investors.
At present, the average cost of debt varies between 12% and 15%, depending on the project’s feasibility. The Planning Commission has estimated an equity shortfall of more than Rs1,50,000 crore for generation projects during the Eleventh Five-Year Plan (2007-2012).
According to government estimates, the expected investment in the power sector will exceed Rs10.5 lakh crore during the plan period.