World Bank signs $200 mn project to boost 'Green State' goal of Himachal

Shimla : The government of India, the Himachal Pradesh government and the World Bank have signed a deal for a $200 million project that will facilitate power sector reforms in Himachal and increase the share of renewable energy (RE) in the state’s electricity generation.

This will contribute to the state’s overall aim of adding 10,000 megawatt (10 gigawatt) of additional RE capacity to make the state’s power supply greener. Himachal aims to become a ‘Green State’ by meeting 100 per cent of its energy needs through renewable and green energy by 2030.

The state currently meets more than 80 per cent of its energy demands from hydropower. The World Bank’s Himachal Pradesh Power Sector Development Programme will help the state enhance the utilisation of its existing RE resources, including hydropower, and help diversify its RE resources further.

For instance, it will add 150 megawatt of solar capacity, reducing greenhouse gas emissions by more than 190,000 metric tonnes per year.

The agreement was signed by K. Manicka Raj, Joint Secretary, Department of Economic Affairs, Ministry of Finance, on behalf of the Government of India; Harikesh Meena, Director (Energy), on behalf of the government of Himachal Pradesh; and Auguste Tano Kouame, Country Director, India, on behalf of the World Bank.

“The programme will boost local economic activity while replacing fossil-fuel based energy consumption with green energy,” said Kouame. “Moreover, the programme will support Himachal to set up a single energy trading desk, thus enabling the sale of surplus hydropower to other states,” he added.

More importantly, the programme will provide a template for the Indian power market for underwriting new investments in renewable energy. In Himachal’s hilly terrain where challenges in maintaining uninterrupted power supply are higher -- and restoration in case of a breakdown may take longer than elsewhere -- the programme will help achieve a strengthened transmission and distribution grid.

It will introduce advanced technologies such as a demand response management system and seamless access to RE. This is critical during peak load periods when the state must otherwise rely on expensive fossil-fuel based power.

The introduction of automated systems will be an important step towards providing clean, reliable 24x7 power supply to citizens, reduce power outages, and minimise consumer complaints.

“The programme will promote good and sustainable practices within the power utilities in the state to transition them to run a green and low carbon electricity system,” said Surbhi Goyal and Pyush Dogra, team leaders for the programme.

“This shall contribute towards the state’s goal to be one of the first ‘Green States’ in the country.” The $200 million loan from the International Bank for Reconstruction and Development (IBRD), the lending arm of the World Bank Group, has a final maturity of 14.5 years, including a grace period of 4.5 years.