80 MW Al Jomaih solar project in Gujarat bags ₹4 B loan from ADB

The 80 MW AJ Solar Power Project, situated in Gujarat, has been granted a Rs 4,063 million loan by the Asian Development Bank (ADB) for environmentally sustainable growth and inclusive economic progress.

The project is being sponsored by Al Jomaih Energy and Water Company, which emerged as a winner in the 500 MW solar auction held by Gujarat Urja Vikas Nigam Limited. The proposed loan will enable the borrower, i.e. AEW India West One Private Limited, to construct a 80-megawatt solar photovoltaic based power plant in Gujarat.

According to ADB, the project will further diversify the energy mix of India in favor of renewable energy and is aligned with the target of Government of India to reach 500 gigawatts of non fossil energy capacity and meet 50% of electricity requirement from renewable energy sources, thereby reducing the carbon intensity of the economy by 45% by 2030.

Further, ADB states that the project is fully aligned with its Energy Policy, which prioritizes support for renewable energy development. The project is consistent with the following operational priorities of ADB’s Strategy 2030: (i) accelerating progress in gender equality; and (ii) tackling climate change, building climate and disaster resilience, and enhancing environmental sustainability.

It contributes to ADB’s goal to provide cumulative climate finance of $100 billion from 2019 to 2030, since the loan of $53.8 million is financing 100% of the climate finance. No adaptation finance has been estimated for this project. It will also contribute to ADB’s operational goal of scaling up private sector development and private sector operations, including supporting private sector operations’ long-term co-financing target, whereby every $1 in financing is to be matched by $2.50 of long-term cofinancing as per ADB’s Strategy 2030.

“By promoting stable power supply and increasing the proportion of renewable energy generation, the project is aligned with pillar 2 (inclusive provision of infrastructure networks and services) and pillar 3 (addressing climate change and increasing climate resilience) of ADB’s country partnership strategy, 2018-2022 with India,” said ADB.