India has raised a total of $1.7 billion loan from the World Bank to support its efforts to accelerate the development of renewable energy in the country. Himachal Pradesh will get $200 million to add 10 GW renewable capacity, while the Indian government will use the remaining $1.5 billion to scale up low-carbon energy investments.
The State of Himachal Pradesh that's currently meeting over 80% of its energy needs from hydropower, aims to increase its green energy share to 100% by 2030. It will use the World Bank loan to diversify its renewable energy sources to meet the same by adding an additional 10 GW to its power supply. Solar's share is estimated to be 150 MW.
The $200 million will come from the World Bank Group's International Bank for Reconstruction and Development (IBRD). "This shall contribute towards the state's goal to be one of the first 'Green State' in the country," said Team Leaders for the bank's Himachal Pradesh Power Sector Development Program, Surbhi Goyal and Pyush Dogra.
Parallelly, the bank has also approved $1.5 billion for the Indian government to promote low-carbon energy by scaling up renewable energy and stimulate private financing in the climate space, since it says public finance is not enough for India to meet its 500 GW non-fossil fuel capacity goal by 2030.
Disbursed as $1.44 billion from the IBRD and facilitated by $1 billion from the United Kingdom, the loan amount also includes $56.57 million credit from the International Development Association (IDA).
The bank is providing this amount under the First Low-Carbon Energy Programmatic Development Policy Operation. It will stimulate financing for green hydrogen, address viability funding gaps, reduce offtaker risks, boost renewable energy grid integration, and encourage demand for renewable energy. It will also help support policies for a national carbon credit trading scheme to launch a national carbon market, and issue $6 billion in sovereign green bonds by 2026.
"The program will support the successful implementation of the National Green Hydrogen Mission that aims to stimulate $100 billion in private sector investment by 2030," said the World Bank Country Director for India, Auguste Tano Kouame.
This is not the maiden financial support from the bank for India's renewable energy goals. It has been supporting growth of solar in the Asian nation through the years. In 2022, it approved $165 million to back 450 MW residential rooftop PV for the country (see India PV News Snippets).