Funds Flow for Clean Energy Transmission Projects

In Clean News, News, Renewable Energy

The Asian Development Bank (ADB) and Asian Infrastructure Investment Bank (AIIB) are jointly going to finance clean energy transmission projects in India.

ADB was already financing India’s Green Energy Corridor projects, which seek to transfer energy from renewable energy rich states to major power demand centres such as the mega cities of Mumbai and other regions. This original support included two US$500 million loans to build and upgrade inter-regional grid systems between the western and southern regions, and high voltage transmission lines and substations in the northern region to help distribute wind and solar generation.

Now ADB and AIIB are going to finance 400kV transmission components in Tamil Nadu to connect at Pugalur with long distance systems. AIIB will provide a co-financing of $100m for this component, which has a total cost of $303.5m. The remaining amount will be financed by POWERGRID and ADB.

Renewables integration remains a key challenge for India, but the government recently released a report saying that integrating 175GW by 2022 is possible. The Ministry of Power has also proposed setting up a host of Renewable Energy Management Centres (REMCs) across the country to help integrate renewables as their penetration increases.

Major renewable energy clusters in India have been identified for the transmission of renewables from Bhadla, Kamuthi, Kurnool, Leh/Ladkah, Rewa and Charanka.

By investing US$150 million in the IFC Emerging Asia Fund, AIIB will also now become one of its major investors to promote the private equity asset class in emerging markets

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