Most delayed drawdowns share one cause. The EPC invoice says one thing, the site says another, and nobody on the owner’s side noticed before the lender’s engineer did. The loan is sanctioned and the plant is half built, yet the next tranche waits for a certificate that cannot be issued on the paper provided.
This guide reads the public lender terms for the engineer who issues that certificate, then turns them into an evidence pack you can assemble yourself. It is part of our solar engineering hub and written for developers and asset owners who carry the cost of every week a tranche is held.
Quick answer. A drawdown certificate is the lender’s engineer’s written confirmation that construction progress and invoices support the next release of loan money. The loan agreement sets its format. IREDA’s 2022 terms ask its engineer to review each drawdown request against progress and invoicing. Prepare by matching every invoice line to physical evidence: delivery records, test reports, measurements and photographs.
What is a drawdown, and who certifies it?
A drawdown is one release of money from a sanctioned loan. The lender does not hand over the full amount at financial close. It pays in tranches while the plant is built. For each tranche the borrower submits a drawdown request with invoices, and the lender wants an independent view that the work behind those invoices exists.
That independent view comes from the lender’s engineer. IREDA, the central government renewable energy lender, calls the role Lender’s Independent Engineer (LIE). A US credit agreement calls it the Independent Engineer. Both are appointed by the lender. Our guide to the owner’s engineer versus the lender’s engineer explains who appoints, who pays and whose side each role takes. This guide does not repeat it.
One point shapes everything below. A certificate records what the engineer verified at a point in time. Sapient Services, an engineering consultancy, puts it plainly in its guide to the lender’s independent engineer, published in March 2026. The certificate states what the engineer verified. It does not release money. The lender applies its own conditions and credit judgement before any funds move. That is a vendor’s description of practice, not a rule, but it matches how the IREDA text is written.
Heaven Designs does not issue drawdown certificates. Those come from the engineer the lender appoints.
What does IREDA’s solar scope say about drawdown certificates?
The clause sits in IREDA’s notice inviting bids dated 9 December 2022. The notice invites firms to join IREDA’s panel of lender’s engineers. Annexure 3 is headed “Terms of Reference (For Wind, Solar and Hybrid)”. Under “Project Implementation Phase (on Quarterly Basis)”, the “Construction Monitoring” list (PDF page 14 of 58) tells the engineer to:
- review the borrower’s drawdown request against project progress and invoicing;
- issue drawdown certificates “as per prescribed formats of Loan Agreements”;
- submit compliance status for each condition precedent to the first drawdown and to each later drawdown, as the loan agreement requires.
Two cautions apply before you rely on this. First, the notice is a bid document for panel firms. It shows what IREDA asks its engineers to do. Your own loan agreement sets the actual conditions and the certificate format. Second, IREDA issued a later notice on 23 July 2025. We opened it. It invites firms for green hydrogen and electrolyser projects only and never mentions solar. Some summaries describe the 2025 notice as the solar scope. It is not. The solar terms are in the 2022 notice.
The rest of the construction monitoring list and the notice’s later annexures say a good deal about what the engineer examines. The table maps each item to the owner-side evidence that answers it.
| What the IREDA text asks the engineer to do (Annexure 3, page 14 to 15; Annexure 5, page 41 to 42) | What the owner side needs on file |
|---|---|
| Monitor project activities against the schedule and review time and cost overruns | Baseline schedule, current schedule, a variance log with reasons |
| Review financial statements and fund flow status | Fund flow statement, equity infusion proof, paid invoices |
| Review delivery schedules and delivery of plant and equipment from suppliers and contractors | Supplier dispatch records, gate entries, store receipts |
| Review the status of statutory approvals and clearances | Approval register with dates and pending items |
| Verify the status of completion of activities under contracts awarded to suppliers and contractors | Measured quantities per package, signed joint measurement sheets |
| Review design and equipment selection against the appraisal report and field conditions | Approved vendor list, datasheets, design change register |
| Summarise all disbursements since the last visit and what they were used for | Utilisation statement tied to invoices |
| Remark on site performance and efficiency tests and certify their compliance with the contract’s performance commitments | Test procedures, signed test records, instrument calibration certificates |
| Report construction progress against material procurement, site work execution, compliances and commissioning status (Annexure 5, deliverables) | One progress report built on those four headings |
| Verify COD (net or gross metering as applicable) and the list of assets in IREDA’s format (Annexure 5) | Commissioning certificate, meter and sync records, asset register |
Annexure 3 also contains a land item that surprises developers. The engineer issues what the notice calls a “Disbursement Certificate” on land. It confirms that the land, in proportion to the disbursement requested, is in the possession of the borrower, contractor, developer or aggregator with unrestricted access. The borrower must give documentary evidence. On a ground-mounted plant, a tranche can stall on a land parcel that is not yet in hand.
The cadence matters too. Annexure 5 requires at least one site visit in each quarter. The site monitoring report is due within 15 days after the visit. Annexure 4 sets a lump-sum fee per quarter per visit. For medium ground-mounted solar (above 10 MW and up to 50 MW) it is ₹75,000 plus taxes. IREDA pays it and debits the borrower’s account, while the borrower bears travel and lodging. That rate card was fixed for FY 2022-23 to FY 2024-25, so the current card may differ. Ask your loan officer. Budget for the visits, and plan your drawdown requests around them.
What does a drawdown look like in a US construction loan?
A filed contract shows the same logic with sharper deadlines. The financing agreement dated 29 July 2016 covered a project of about 43 MW DC in Bladenboro, North Carolina. The parties were Innovative Solar 31, LLC, KeyBank National Association and the lenders. It is filed on SEC EDGAR as Exhibit 10.2. Section 3.2 sets the conditions to each construction loan borrowing.
- Five working days before the borrowing date, the borrower gives the Independent Engineer the information and certificates from the borrower and the EPC contractor. It also gives the agent a signed Drawdown Certificate with attachments. The agreement defines the term as a business day.
- Three working days before the borrowing date, the Independent Engineer must have verified those certificates, the supporting invoices and other evidence of payment. It must also have given the agent its own certificate.
- Other conditions run in parallel. The borrower delivers a title insurance date-down. It shows that remaining funds cover unpaid costs to final completion. It also delivers lien waivers from contractors above a contract value of $100,000. Permits must be in force, and work must have been done in a good and workmanlike manner under the EPC agreement.
- Section 5.5 lets the Independent Engineer visit the site at least once each calendar month before substantial completion and report monthly.
The filing does not reproduce the text of the certificate forms, so we do not describe them. This is one US agreement from 2016, not a template. Indian loan agreements differ in format, timing and visit frequency. The pattern still holds: the engineer works from the borrower’s package, and the lender adds its own conditions on top.
What evidence does the engineer want at each milestone?
The IREDA text frames progress in four parts: material procurement, site work execution, compliances and commissioning status. We use that frame and split the build into supply, erection, electrical and commissioning. The right-hand column tells you whether a row comes from the documents or from our own judgement.
| Milestone | Evidence to assemble | What the engineer is testing | Basis |
|---|---|---|---|
| Supply | Purchase orders, supplier invoices, dispatch and transport records, gate and store receipts, manufacturer test reports, serial number lists for modules and inverters | Do delivered items match the approved vendor list and the invoice? Is the invoiced value sitting on site? | IREDA asks for review of delivery schedules and delivery of plant and equipment. The document list is our judgement |
| Erection | Joint measurement sheets, pile or foundation test records, structure alignment checks, dated site photographs with location, daily progress reports, material reconciliation | Is the quantity claimed physically in place, and in the right place? | IREDA asks the engineer to verify completion status of activities under each contract. The record types are our judgement |
| Electrical | DC and AC cable test records, insulation resistance readings, inverter and transformer installation records, protection settings, earthing resistance results, evacuation and switchyard status | Is the electrical build complete and tested, and is evacuation on track against the power purchase agreement? | IREDA asks for status of approvals and review of evacuation. Test record types are our judgement. See our CEIG inspection checklist |
| Commissioning | Commissioning test records under IEC 62446-1, grid synchronisation records, meter details, performance test results, punch list, as-built drawings, insurance and asset list | Does the installation match the design, and do the tests meet the contract’s performance commitments? | IREDA names the completion certificate, the equipment-versus-design check and the performance tests. See our commissioning checklist |
Two habits make this pack cheaper to build. Sapient advises tying each milestone to a quantity, test or certificate and not to a percentage complete. A percentage is an opinion. A measured quantity or a signed test record is evidence. And the pack is built as the work happens, not at the end of the quarter. Photographs taken in week three cannot be recreated in week twelve.
What does an illustrative milestone table look like?
The table below is illustrative. The percentages are our assumptions, chosen to make the arithmetic clear. They are not any lender’s disbursement schedule and not IREDA’s. Your EPC contract and your loan agreement set the real triggers.
| Milestone | Illustrative share of EPC value | Cumulative | Typical proof an owner assembles |
|---|---|---|---|
| Mobilisation and site development | 10% | 10% | Site handover record, fencing, road and drainage measurements |
| Supply of modules, structures, inverters and transformers at site | 45% | 55% | Dispatch records, store receipts, manufacturer test reports |
| Erection of structures and module mounting | 20% | 75% | Joint measurement sheets, alignment checks, photographs |
| Electrical installation and evacuation works | 15% | 90% | Cable and insulation test records, earthing results, switchyard status |
| Commissioning, testing and COD | 7% | 97% | Test records, sync and meter records, completion certificate |
| Retention release after performance testing | 3% | 100% | Performance test report, punch list closure |
Here is a worked example on the supply row, again illustrative. Assume an EPC value of ₹100 crore, a round number for easy arithmetic and not a market price. Assume the lender funds 70% of each eligible cost on a pro rata basis. The EPC contractor invoices the full supply milestone at 45%, which is ₹45 crore. The borrower’s drawdown request asks for 70% of that, ₹31.5 crore.
On review, equipment worth ₹36 crore is on site, matched to store receipts and carries manufacturer test reports. The balance, ₹9 crore, is in transit or lacks test reports. The supported claim is ₹36 crore, and 70% of that is ₹25.2 crore. The difference of ₹6.3 crore waits for the next request. The plant is no worse for it, yet the owner’s cash plan has a hole of ₹6.3 crore until the missing records arrive.
An owner’s engineer who reconciled the invoice with the store receipts before submission would have trimmed the request to ₹25.2 crore. That draw would have gone through without a query. The “70%” and the pro rata method are assumptions. For IREDA’s rooftop scheme, the Financing Norms say regular disbursement is pro rata to physical and financial progress. That is Issue 33, updated to 12 June 2026. That sentence is in the rooftop chapter. Check your own sanction letter for how your loan is released.
How should the owner’s side prepare a drawdown pack?
An owner’s engineer, or a project management consultant working for the owner, can run this routine. The steps follow the order in which a drawdown moves.
- Map the three schedules. Put the EPC payment milestones, the loan agreement’s conditions precedent and the lender engineer’s visit calendar on one sheet. A milestone that completes the week after a visit may wait for the next one, because IREDA’s cadence is at least one visit a quarter.
- Build the evidence index first. List every document the milestone needs, the owner of each document and its due date. Mark each row “in hand”, “requested” or “missing”. The index is the pack’s table of contents.
- Measure before you invoice. Run a joint measurement with the EPC contractor and sign it. The contractor’s invoice should quote that sheet. This single step prevents most of the shortfall in the worked example.
- Reconcile invoices to physical items. For supply, match each invoice line to store receipts and test reports. For erection, match to measured quantities. Quantities that do not match go into a variance note with a reason.
- Walk the site before the lender’s engineer does. A short walk with a photograph log finds the unlabelled pallet and the missing earthing record.
- Update the open-items list. The certificate may carry open items such as pending test reports, as Sapient notes. Keep a list with a closing date for each, so the next certificate can drop them.
- Submit the pack as one indexed set. Cover note, evidence index, documents in index order, then photographs. An engineer who finds every item in one place spends the visit checking and not hunting.
Our guide to the owner’s engineer for solar projects covers the full stage-by-stage scope of that role. The lender engineer’s checks at financial close come earlier and are a different exercise.
If you want project management support during construction, Heaven Designs offers MW-scale project management consultancy. Its page describes project management for utility-scale solar projects from feasibility through commissioning. Its scope list includes construction management (on-site supervision, contractor coordination and milestone tracking), QA and QC protocols with inspection reports, and commissioning and handover. It is a consultancy service. It does not act for the lender, and it does not issue drawdown certificates.
Why do drawdown certificates get delayed?
These causes come from our own judgement of how construction loans work in practice, not from a published study. Each one maps to something the IREDA terms ask the engineer to check.
- The invoice runs ahead of the site. The contractor bills a milestone on dispatch. The engineer counts only what is on site. This is the most common gap and the one the worked example shows.
- Test reports arrive after the equipment. Modules reach site and the manufacturer’s reports follow weeks later. The engineer cannot confirm quality, so the certificate carries an open item or the value is trimmed.
- Equipment differs from the approved list. A substituted inverter or cable make with no recorded design change triggers a query on design and equipment selection.
- Land or approvals lag the draw. For a ground-mounted plant, the land certificate in Annexure 3 ties the draw to land in hand. A pending approval can hold a draw in the same way.
- Funds are out of balance. If overruns mean the remaining loan and equity cannot finish the plant, the lender stops releasing. It waits until the shortfall is covered. The US agreement above states this test directly. IREDA’s text asks the engineer to review overruns and fund flow.
- Changes are not recorded. A variation agreed on site and not logged leaves the engineer unable to reconcile the invoice with the contract.
- The visit calendar and the milestone do not meet. The work finishes just after the quarterly visit, so verification waits for the next one.
- The pack arrives unindexed. The documents exist, but nobody can find them during the visit, so the engineer lists them as missing.
Most of these trace to documentation habits and not to engineering faults. They are also the cheapest to fix. The loan, the EPC contract and the lender’s engineer each use their own terms. Ask your lender to confirm in writing what it needs for each tranche before the first request.
What happens at completion?
The last certificate is different in kind. The IREDA terms (Annexure 3, page 15) call for a signed project completion certificate. It covers project commissioning, the adequacy of installation of all equipment against the project design, and compliance with regulatory stipulations, permits and licences. After three months of operation, the engineer also reports on generation data and performance tests.
By then, the evidence is the as-built set, the commissioning test records and the permit file. Our guide to commissioning checklists under IEC 62446-1 describes the test regimes. For the performance commitments the engineer checks the plant against, read about liquidated damages and performance bonds. A plant that reaches bankability on paper at financial close still has to show the same quality at the last draw.
What should you do before the first drawdown request?
Do four things in the next two weeks. Read the drawdown clause and certificate format in your loan agreement. Compare the EPC payment milestones with the lender’s conditions precedent. Agree an evidence index with your EPC contractor. Then fix who on the owner’s side owns the pack for each milestone.
For the paper behind the loan itself, see our guide to solar project loan documents in India. If you want construction-side support, review the MW-scale project management consultancy page. Then contact the Heaven Designs team with your project size, loan stage and EPC contract status. Scope and timing are agreed at scoping.
FAQ
What is the difference between a drawdown certificate and a percentage completion certificate?
A percentage completion certificate states how much of the work is done. A drawdown certificate states whether the borrower’s request for money is supported by progress and invoices, and whether the conditions precedent are met. The IREDA text asks for the second. The percentage can feed it, but a measured quantity is stronger evidence.
Who pays for the lender’s engineer on an IREDA solar loan?
Under the 2022 notice, IREDA pays the engineer’s lump-sum fee and debits it to the borrower’s account. The borrower pays travel, boarding and lodging directly. The rate card in the notice covered FY 2022-23 to FY 2024-25, so confirm the current terms with IREDA.
Can the owner’s engineer sign the drawdown certificate?
No. The certificate comes from the engineer the lender appoints, in the format the loan agreement sets. The owner’s engineer can prepare and reconcile the pack before the lender’s engineer sees it. Our guide to the owner’s engineer versus the lender’s engineer explains why one firm should not hold both roles.
Does a certificate mean the lender will release the money?
Not by itself. Sapient notes that the lender applies its own conditions and credit judgement. Confirm with your lender which conditions sit outside the engineer’s certificate, such as security, insurance and equity infusion.
How often does the lender’s engineer visit?
Annexure 5 of the IREDA 2022 notice requires at least one site visit in each quarter. The site monitoring report is due within 15 days after the visit. The US agreement above allows monthly visits. Your loan agreement sets your frequency.
Does this apply to rooftop solar loans?
IREDA’s notice covers large rooftop solar as a separate technology, and its Financing Norms have a rooftop scheme chapter with its own monitoring terms. The drawdown text in Annexure 3 is headed for wind, solar and hybrid. Check which chapter of your sanction letter applies.