• Bhutan has secured $3 million from the ADB to provide small scale solar PV systems to poor rural households
  • These systems will be integrated to the national grid and enable users to generate income by selling excess energy to the grid
  • The grant will be part of the ADB administered Japan Fund for Poverty Reduction

The Asian Development Bank (ADB) has approved a grant of $3 million for the Royal Government of Bhutan to ensure poor rural households have access to small-scale solar PV systems that will be integrated to the national grid.

The grant will come from ADB administered Japan Fund for Poverty Reduction (JFPR) and will also support energy-based livelihood equipment and skills training.

According to the bank, this project will demonstrate the viability and sustainability of solar power as an alternative sustainable energy and income source.

“The project will help the government identify the regulatory requirements for alternative renewable energy, develop tariff structure, particularly for residential solar photovoltaic systems, and enable rural households to produce energy for their own consumption and generate income through selling excess power to the grid,” said Kanokpan Lao-Araya, ADB Country Director for Bhutan. “The project has strong pro-poor, socially inclusive, and gender-sensitive features that will demonstrate the social and economic benefits of solar power in pilot rural villages.”

The bank has been in talks with the Bhutanese government to deploy a 30 MW solar power plant at Shingkhar in Bumthang district and a 17 MW project at Sephu in Wangdue Phodrang district.

In September 2020, in order to ascertain viability of large scale solar technology in the country, Bhutan Power Corporation Limited invited bids for 180 kW grid tied ground mounted solar PV capacity (see Bhutan Launches 180 kW Solar Power Tender).

According to the International Renewable Energy Agency (IRENA), Bhutan’s total renewable energy capacity till the end of 2019 reached 2.33 GW, all of which came from hydropower. In a December 2019 Renewables Readiness Assessment Kingdom of Bhutan report, IRENA suggested non-hydro renewables can bring in a number of benefits to the country in terms of stopping deforestation, improving health, specially of women and also ensure diversification of energy sources in times of unpredictable climate changes.