ESCROW Disbursement
The NHEV financial structure is based on a Station-wise Escrow mechanism, wherein each 3G Energy Station is established as a separate Station SPV with its own dedicated Escrow Account. This ensures that the financing, construction expenditure, station revenues, debt servicing and returns are ring-fenced at the individual station level.
Upon allotment of a station, the Allottee provides the prescribed Letter of Credit (LC) for the respective Station SPV. Following fulfilment of the applicable conditions, HDFC Bank funds the dedicated Escrow Account of that Station SPV with the approved financing amount.
The Escrow funds are utilised exclusively for the construction, commissioning and commercialisation of that particular 3G Energy Station. The construction and initial commercialisation period also constitutes the moratorium period for the Bank's EMI, allowing the station to become operational and establish revenue generation before regular debt servicing commences.
Once commercial operations begin, all revenues generated by the individual station are credited into the same Station SPV Escrow Account. These revenues are distributed through a defined cash-flow waterfall towards:
Station Operator Payment
Bank EMI / Debt Servicing
Balance Return to the Station Allottee
Since each station operates through an independent SPV and Escrow Account, its funding, revenue generation, expenditure and debt servicing remain separately accounted for at the station level.
During the early stages of commercialisation, if the station has not generated sufficient revenue to provide a return to the Allottee, or if available cash flows are insufficient to meet the Bank EMI or Station Operator payment obligations, the Allottee may be required to infuse blended financing to bridge the temporary funding gap and maintain uninterrupted construction, operations and debt servicing.
Accordingly, the Station SPV–Escrow structure provides a ring-fenced, station-level financing and cash-flow mechanism, linking the Bank's funding directly to the respective station's construction, commercialisation, revenue generation, debt servicing and Allottee returns.