World Bank Inks Project to Scale up Renewable Energy Technologies in India

The World Bank has announced that it has signed agreements with the Government of India (GoI) and Solar Energy Corporation of India Limited (SECI) for a $150 million IBRD loan, a $28 million Clean Technology Fund (CTF) loan and a $22 million CTF grant.

The objective of the financial agreements is to help India increase its power generation capacity through cleaner, renewable energy sources. World Bank said that the agreement underscores the Government of India’s commitment to achieve 500 GW of renewable energy by 2030 in order to address the challenges of climate change.

The $150 million loan from the International Bank for Reconstruction and Development (IBRD), has a 5-year grace period, and a maturity of 25 years. The $28 million loan from the Clean Technology Fund (CTF) has a 10-year grace period, and a maturity of 40 years. The $22 million is an interest-free CTF grant.

“India’s transition to renewable sources of energy is one of the most critical transitions for its future,” said Hideki Mori, Operations Manager & Acting Country Director, India, World Bank.

The Project aims to address constraints in commercial investments in this sector through increasing the confidence of the various stakeholders. The Project will also help SECI increase market uptake by addressing the barriers to deploying new technologies at scale.

The first solar sub-project is being constructed by Battery Energy Solar Systems (BESS) in Rajnandgaon district of Chhattisgarh. The second subproject which will have floating solar panels is ongoing at the Getalsud reservoir in Jharkhand.

India currently has an installed capacity of more than 409 GW, of which the renewable energy (non-hydro) share is almost 29 percent (119.5 GW). World Bank opines that the project will accelerate India’s progress towards sustainable universal electricity access, which is a key milestone for achieving inclusive economic development objectives.

World Bank also maintained that strengthening SECI’s capacity is critical to achieving India’s installed RE capacity by 2030 and net zero emission target by 2070. The project will support SECI with human resource and business planning, project monitoring, procurement, financial and contract management, environmental and social safeguards and financial management, among others.

“This engagement attempts to introduce nascent technologies in the renewable energy sector at a relatively larger scale. The subprojects financed under this Project aim to displace fossil-fuel based generation by positioning renewable energy to meet peak power demand, establish ecosystem to attract private sector investments, and support institutional strengthening,” said Surbhi Goyal, Senior Energy Specialist and Task Team Leader for the project, World Bank.