Supporting a credit line for energy efficiency measures in Indian MSMEs

Laborer working

Recognising the importance of de-linking economic growth from energy consumption, India increasingly emphasises the energy efficiency of its industries. Thus, the Small Industries Development Bank of India (SIDBI) provides a dedicated credit line with a budget of 50 million Euro to Micro, Small and Medium sized Enterprises (MSMEs) for investments in energy efficiency measures. The goal of this credit line is to reduce 400,000 tons of CO2 emissions per year.

adelphi has supported SIDBI with setting up, disbursing and monitoring the credit line, in cooperation with the International Institute for Energy Conservation (IIEC) and the Dutch consulting firm Triodos Facet. This involved developing a monitoring and verification system for loan disbursement that will enable SIDBI to monitor the actual emission reductions achieved per loan as well as the total reduction over the lifetime of the credit lines.

Additionally, the consulting team recommended institutional framework conditions for successful loan disbursement, provided training and capacity building, technical evaluation of loan applications, and a focused marketing strategy. Furthermore, adelphi was tasked to assist MSMEs in identifying suitable investment opportunities and support companies with the development of loan applications.