IOCL-GPS Renewables JV to Set up CBG Projects with Rs 1,200-cr Fundraise

IOCL GPS Renewables, a 50:50 joint venture between Indian Oil Corporation (IOCL) and GPS Renewables, plans to raise up to Rs 1,200 crore, primarily through long-term debt, to finance the establishment of nearly 10 Compressed Bio Gas (CBG) plants across India.

The fund-raising process is expected to be completed within the next 12 months, with the aim of operationalizing the first set of projects within two to three years.

Both firms will raise the debt jointly as project developers. Though the specific debt instruments are yet to be finalized, all options are being considered, with a strong preference for securing long-term financing from banks. The financing structure will be split into 70 percent debt and 30 percent equity, with IOCL and GPS Renewables contributing equally to the equity portion.

In addition, the JV has already signed two more agreements with oil marketing companies, indicating strong sectoral interest. This initiative aligns with the Indian government’s Sustainable Alternative Towards Affordable Transportation (SATAT) programme, which promotes the use of CBG and other renewable fuels to enhance energy security, reduce greenhouse gas emissions, and support India’s net-zero targets.