ADB approves $175 mn loan to Power Grid Corp

Asian Development Bank (ADB) has approved $175 million loan to Power Grid Corporation to expand its solar energy transmission network in the country.

The project funding will improve the capacity and efficiency of interstate transmission networks, particularly in transmitting the electricity generated from new solar parks to the national grid, an ADB statement said.

Apart from the evacuation of 2,500 megawatts of power from solar parks in Bhadla, Rajasthan, and 700 MW from Banaskantha, Gujarat, Power Grid is also including two additional sub projects, it said.

These two sub projects will increase solar power generation by 4.2 gigawatt and lessen carbon emissions by over 7 million tonnes every year, the statement said.

ADB said as part of the assistance, it will also provide a $50 million co-financing loan from Clean Technology Fund -a $5.8 billion component of the Climate Investment Funds.

The Climate Investment Fund is aimed at providing developing countries resources to expand efforts in utilising low carbon technologies and transitioning to clean, renewable energy sources.

ADB said the solar transmission sector project is also the first project to be implemented following usage of agency level country safeguards and procurement systems for Power Grid to speed up processes. It will also provide autonomy and ownership of the project.

"India, with its mandate of achieving a more sustainable future, is leading the lines in achieving energy security while increasing energy capacity and supply through renewable sources such as solar energy," said Kaoru Ogino, an ADB Principal Energy Specialist.

Manila-headquartered ADB provides loans at concessional rates to countries to Asia to reduce poverty and help inclusive growth.