At Neufin, we’ve been driven by our vision to be the platform that drives the transition to net zero emissions. When we launched Neufin three years ago, we strategically focused on achieving our vision by enabling the flow of capital through the Voluntary Carbon Market (VCM). We recognised that while the VCM was fraught with complexity and uncertainty, it also held immense potential to mobilise capital for climate projects. We built the products and capabilities to bring much-needed transparency to this space, thereby unlocking its full potential and help businesses move faster towards their climate goals. Through our work in the VCM, we’ve made significant strides in channeling finance into meaningful climate projects. However, the world is rapidly evolving, and so too must our approach to driving climate action.
It’s no secret that climate targets are becoming more ambitious, while the path to achieving them seems to get steeper. More immediate and accessible solutions are required—especially for mid-market businesses in the global south. Focusing on India – its industrial sector accounts for over 52% of the country’s total energy demand and is growing at a CAGR of 5% year on year. India plans to add 473 GW of power generation capacity by 2030 to support this growth, of which 303 GW is expected to be met by RE sources. According to a 2024 report, less than 5% of electricity consumed by major industries came from Renewable Energy (RE) sources. This is in contrast with India’s ambitious RE targets for 2030 – 500 GW of RE capacity, in line with Paris Agreement Targets. Meeting India’s 2030 targets will require an average annual capacity addition of roughly 50 GW. Our best year so far has been 18.4 GW in year 2023-24. The gap is glaring.
With this in mind, Neufin is making its boldest move yet. Today, we announce the launch of Neufin Energy and Neufin Capital to catalyse and accelerate the RE transition for businesses. We aim to help businesses procure and finance RE by making it easier, faster and more transparent. This launch builds on our learning over the past two years that financing assets alone does not solve the problem – origination of high-quality projects and green assets is equally critical to driving the net-zero transition. RE is a key component of India’s decarbonisation journey, and we’re here to help businesses tap into its immense potential – both on asset origination and financing.
Why a focus on RE is necessary to drive large-scale climate impact
India’s industries are feeling the heat—literally. In 2021 alone, heatwaves contributed to a 5.4% loss in GDP, impacting sectors like manufacturing, agriculture, and construction. This isn’t just a story of rising temperatures; it’s a tale of shrinking profit margins and increasing risk. Indian businesses, which account for over half of the country’s electricity consumption, are not just victims but significant contributors to domestic emissions.
The need to act is pressing, but many businesses are hesitant. Mid-market Commercial and Industrial (C&I) customers in India are power hungry and require ~78 GW of RE power by 2030 to meet their requirements, a 239% jump from current demand. Energy costs have soared—industrial tariffs in India have spiked by 30-40% in the past five years alone. Meanwhile, the cost of Renewable Energy, particularly solar, has plummeted. Utility-scale solar in India is now priced at ₹ 2.5- 3.5 per kWh, compared to ₹ 6-8 per kWh for coal-based power.
We believe that RE is the most immediate and impactful solution for businesses to manage their energy costs, reduce their carbon footprint, and build resilience in the face of an uncertain future.
The business case for transitioning to RE is crystal clear
- Lower Energy Costs: Solar power is significantly cheaper than fossil fuels, and the long-term trends show RE costs falling even further, while fossil fuel prices are likely to fluctuate. By transitioning now, businesses can lock in lower costs and avoid future volatility.
- Regulatory Preparedness: The Indian government has set ambitious RE targets—500 GW of non-fossil fuel capacity by 2030—and regulations will likely become stricter over time. The Government of India also plans to launch the pilot phase of the Indian Carbon Market (ICM) in 2025. By acting now, businesses can stay ahead of the curve, benefit from incentives, and avoid penalties that may be levied on laggards.
- Access to Cheaper Capital: There are several financing options available today, from green loans to power purchase agreements, that make RE adoption more financially feasible than ever. Companies can now go green without straining their balance sheets, and those with strong sustainability goals can even access capital at lower rates.
- Competitive Edge: Businesses that prioritise sustainability are increasingly favoured by customers, investors, and even regulators. By aligning with global trends, businesses can improve their reputation, open up new partnerships, and gain preferential treatment in certain markets.
- Energy Security: India’s power supply can be unpredictable, but RE offers greater independence. Businesses generating their own power or entering into long-term PPAs can ensure a more reliable and stable energy supply.
Looking ahead with Neufin Energy and Neufin Capital
Neufin Energy will help C&I businesses adopt RE at scale, efficiently and effectively by exponentially simplifying their decision making process. We do this taking away the complexity of understanding the nuances of tariffs, technology, regulations etc. and connecting C&Is to the right IPP/EPC execution partners.
Neufin Capital, meanwhile, will focus on enabling C&I businesses to finance their RE adoption via innovative and accessible financial products. Our Asset Risk Management product – Investment Grades will help investors evaluate and mitigate project risk – unlocking capital for C&Is to access RE.
Our commitment to accelerating decarbonisation and unlocking capital remains unwavering. Our vision continues to be the same – to be the platform that drives the net-zero transition and our mission to catalyse $10 billion in capital into climate by 2028.
RE is the next frontier, and we’re excited to be “The Energy Transition Catalysts” driving this change.
– From Rahool Gadkari and Rushil Noronha (Co-founders – Neufin)
