India, World Bank ink $98 million loan pact for renewable energy1 min read . Updated: 20 Nov 2017, 07:50 PM IST
The Shared Infrastructure for Solar Parks Project will finance IREDA to provide sub-loans to states to invest in various solar parks, World Bank says
New Delhi: India and the World Bank on Monday signed a $98 million loan pact, and a $2 million grant agreement to help the country increase power generation capacity through cleaner, renewable energy sources.
The Shared Infrastructure for Solar Parks Project will finance Indian Renewable Energy Development Agency Ltd (IREDA), to provide sub-loans to states to invest in various solar parks, the World Bank said in a statement. The solar parks will be mostly under the Ministry of New and Renewable Energy’s (MNRE) Solar Park Scheme, it said.
The first two solar parks are in the Rewa and Mandsaur districts of Madhya Pradesh, with targeted installed capacities of 750 MW and 250 MW respectively, it said. Other states where potential solar parks could be supported under this project are in Odisha, Chhattisgarh, and Haryana.
The government is committed to setting up an enabling environment for solar technology penetration in the country, said Sameer Kumar Khare—Joint Secretary in the Department of Economic Affairs. “This Project will help establish large-scale solar parks and support the government’s plan to install 100 gigawatts (GW) of solar power out of a total renewable-energy target of 175 GW by 2022," he said in the statement.
The IREDA will utilise the funding under this project to develop the common infrastructure such as power pooling substations, intra-park transmission infrastructure and provide access to roads, water supply and drainage. While some states intend to provide a full range of infrastructure services to the selected private or public sector developers, others plan to provide only pooling stations to facilitate internal evacuation.
With about 331 GW of installed capacity, India’s power system is among the largest in the world. Yet, the per capita electricity consumption is less than one-third of the global average. An estimated 300 million people are not connected to the national electrical grid, the statement said, adding that with a rapidly growing economy the need for reliable power is only going to grow.
The $75 million loan from the International Bank for Reconstruction and Development (IBRD), has a 5-year grace period, and a maturity of 19 years. The $23 million loan from the Clean Technology Fund (CTF) has a 10-year grace period, and a maturity of 40 years. The $2 million is an interest-free CTF grant.