How to Get a Green Loan for a Foundry in Kolhapur

Published 2026-10-13.

Kolhapur's foundries cast the engine blocks, pump housings and machine parts that India's auto and engineering industries run on. Melting iron takes a great deal of energy, by coke in cupolas or electricity in induction furnaces, so the energy bill is the biggest cost a foundry owner can actually change.

Maharashtra has a plan for that. A State Energy Efficiency Action Plan prepared by the Bureau of Energy Efficiency in 2024 sets a target for foundries to cut energy use by 0.066 to 0.088 million tonnes of oil equivalent by 2031. But in June 2026, Down To Earth reported that Kolhapur owners face poor awareness of schemes, limited access to subsidised finance and weak implementation. This article answers the practical question: how does a Kolhapur foundry finance the upgrade?

What actually saves energy in a foundry

Auditors interviewed by Down To Earth made a point many owners miss: switching from coal to electricity is not the same as becoming efficient. The savings come from:

Melting: furnace optimisation, correct charge mix and sizing, lids kept closed, and repairs to linings and coils.
Cupolas, where still used: the divided-blast cupola. SBI's Project Uptech work in Kolhapur reported about 30 percent fuel savings with it, adopted by around 90 units.
Ladles and holding: preheating and insulation to cut heat losses between melt and pour.
Sand plant, compressors and motors: variable-speed drives and leak repair.
Power supply: rooftop or open-access solar for the melting load.

The finance options

ADEETIE. The Bureau of Energy Efficiency's scheme offers a 5 percent interest subvention for micro and small units and 3 percent for medium units, for projects that save at least 10 percent energy, in its notified clusters. Check whether Kolhapur is listed for foundries before planning around it; see ADEETIE scheme eligibility and application.

Bank term loans. Down To Earth described one Shirol foundry, Kohinoor Metallics, that spent ₹10 lakh repairing and upgrading machinery and took a ₹6 crore loan from a private bank at industrial interest rates for a 6 MW open-access solar plant. That is the ordinary route when a scheme does not fit.

Solar loans. Banks run dedicated solar loans for MSMEs; owners told the same reporter that changing solar banking rules and grid charges have stretched paybacks, so model your own case carefully.

What the lender needs

Twelve months of electricity bills and coke or fuel invoices.
Monthly output in tonnes of good castings, so you can state kWh or coke per tonne.
An energy audit with each measure's saving and cost; see how to get an energy audit for an MSME.
A metering plan for proving the saving later.

Senseible reads the bills and fuel invoices you already have and gives you energy and emissions per month, each figure linked to its source document, the baseline both the auditor and the bank ask for.

Will Europe care?

Iron castings sold to EU buyers are not covered by CBAM today, as the Shirol owner noted, but the EU has proposed bringing about 180 more steel products into CBAM from 2028. Buyers already ask for emissions per part. A foundry that measures now will be ready for both.

Confirm current eligibility and terms with the lender before you apply.