The government is considering a proposal to grant the ‘development financial institution’ (DFI) status to REC Ltd, a Navratna CPSE under the power ministry. It is aimed at enabling the state-owned company to steer global climate funding and net-zero investment in the country.
In its annual general meeting (AGM) conducted on Friday (September 16), REC Chairman and Managing Director Vivek Kumar Dewangan informed investors about the company’s future vision to diversify into energy transition and future technology funding.
The estimated fund requirements for transitioning towards a net-zero economy will be about $3.5 trillion till FY2050 and nearly $10 trillion till 2070, out of which, a large share of investment will be required in the power sector, according to a statement.
REC as a DFI will analyse end-to-end capital flow requirements and bridge the gap by large-scale fund mobilisation and monitoring the funds. With strong domain expertise and appraisal capabilities, REC is strategically placed to dispense the duties and responsibilities of a DFI.
“With these developments, REC is poised to contribute in the nations journey to become an infrastructure behemoth that will responsibly realise the dream of a safe and carbon-neutral tomorrow for generations to come. REC has been steadfast in shaping and modelling itself with the changing needs of the nation – be it providing financial support across all segments of power sector, providing energy infrastructure to all villages and electricity access to all households to now reinventing itself in line with the net-zero requirements of India’s booming economy," the statement said.
In the June 2022 quarter, REC posted an 8 per cent increase in its consolidated net profit to Rs 2,454.16 crore, on the back of reduced expenses. The company had clocked a net profit of Rs 2,268.66 crore during the April-June quarter of financial year 2021-22. Its total income, however, fell to Rs 9,506.06 crore in the June 2022 quarter, from Rs 9,555.45 crore in the year-ago quarter.