Power Finance Corporation Sets Ambitious Renewable Energy Target
Power Finance Corporation (PFC) has announced a significant shift toward green financing. The company aims to boost renewable energy projects to 20% of its total loan portfolio over the next three years. This marks a clear increase from the current level of 15%.
Kolkata Announcement Details
PFC chairperson Parminder Chopra made this announcement during a visit to Kolkata on Thursday. She was in the city for the launch of a Rs 5,000 crore non-convertible debentures issue. This financial instrument will open for subscription on January 16.
Chopra emphasized that renewable energy and distribution networks will become key focus areas for PFC moving forward. The company intends to channel more funds into sustainable power projects across India.
Current Portfolio Breakdown
As of September 30, 2025, PFC's total loan portfolio stood at an impressive Rs 5.6 lakh crore. Within this massive amount, renewable energy projects already account for Rs 85,000 crore. This segment demonstrated remarkable growth over the previous year.
Between September 2024 and September 2025, the renewable energy portfolio expanded by 32%. It grew from Rs 63,000 crore to Rs 85,000 crore, adding Rs 22,000 crore in new financing.
Traditional Power Sector Dominance
Generation and distribution activities continue to dominate PFC's lending activities. Together they constitute 86% of the company's loan assets. State distribution companies and generation companies form the largest portion of the loan book at Rs 3.8 lakh crore.
Chopra noted that the financial health of the power sector has shown improvement. Specifically in the eastern region, she mentioned that distribution companies in Bengal and Assam maintain timely payments with PFC.
Diversification Beyond Power
PFC has gradually expanded its financing scope beyond traditional power projects. The company now actively participates in infrastructure and logistics sectors. These new areas already account for Rs 14,700 crore in the loan portfolio.
Asset Quality Improvements
The chairperson reported positive developments regarding non-performing assets (NPAs). PFC's NPAs have decreased significantly to just 0.3% of the portfolio. This represents a substantial improvement from the 1.8% gross NPAs recorded in 2023-24, which amounted to approximately Rs 10,400 crore.
Most problematic assets originate from the generation segment. Currently, eleven projects totaling Rs 8,400 crore are undergoing resolution at the National Company Law Tribunal (NCLT). Chopra identified the largest single case as involving Rs 3,000 crore.
PFC's strategic shift toward renewable energy reflects broader trends in India's power sector. The company's growing green portfolio aligns with national sustainability goals while maintaining strong financial performance.
