Despite several of its loans to coal-fired power projects turning bad, public sector lender Power Finance Corporation and its subsidiary, Rural Electrification Corporation, continue to fund such projects — even though they are clearly not viable. This is the finding of a study by the Cleveland, US-based Institute for Energy Economics and Financial Analysis (IEEFA), an environmental advocacy think-tank which analyses financial and economic issues related to energy and environment.
“IEEFA views PFC’s lending to new existing or new thermal power developments extremely risky in the light of the expected tariffs on these projects being 60-70 per cent above the prevailing renewable energy tariffs of ₹2.50-2.80 a kWh.
