World Bank approves loan of $200 million to Himachal for power reforms

A $200 million loan from the World Bank has been granted for the Himachal Pradesh government in order to support power sector reforms and raise the proportion of renewable energy (RE) in the state's electricity production. This will help the state achieve its overall goal of increasing its renewable energy capacity by 10,000 megawatts (10 gigawatts) to make the state's electricity supply greener.

Himachal Pradesh wants to become a "Green State" by supplying all of its energy requirements with green and renewable sources by the year 2030. At the moment, hydropower supplies more than 80% of the state's energy needs. The Himachal Pradesh Power Sector Development Programme of the World Bank will assist the state in increasing the utilisation of its current RE resources, especially hydropower, and assist in further diversifying its RE resources.

For instance, it would increase the state's solar capacity by 150 megawatts, which will result in a 190,000 metric tonne annual reduction in greenhouse gas emissions. Auguste Tano Kouamé, the World Bank's Country Director for India, stated that the plan "will stimulate local economic activity while replacing fossil fuel-based energy consumption with green energy."

Additionally, the plan will assist Himachal Pradesh in establishing a unified energy trading desk, making it possible to sell excess hydropower to neighbouring states. However, the plan will serve as a model for the Indian power market to use when financing new renewable energy investments. The plan will assist in achieving a reinforced transmission and distribution grid in Himachal's steep terrain where problems in sustaining uninterrupted power supply are higher and restoration in event of a breakdown may take longer than elsewhere.

It will debut cutting-edge tools like a demand response management system and frictionless access to RE. This is crucial at times of high demand when the state would otherwise have to rely on pricey fossil fuel-based energy. Automated systems will be a crucial step in ensuring that citizens have clean, dependable power supply around-the-clock, reducing power interruptions, and reducing customer complaints.

The plan will support the state's power sector utilities and agencies in improving their environmental, social, financial, corporate governance, and procurement skills. Additionally, it will help open up career prospects in the sector, particularly for women, in specialised technical and management domains. Throughout the course of the programme, state power utilities will teach about 700 female apprentices, providing them with practical experience and training in technical roles within the power sector.

The National Apprentice Promotion Scheme put in place by the Ministry of Skill Development and Entrepreneurship will be built upon by this. Surbhi Goyal and Pyush Dogra, the program's team leaders, stated that the plan "will promote good and sustainable practises within the state's power utilities to transition them to run a green and low carbon electricity system."

This will help the state achieve its aim of becoming one of the nation's first "Green States," according to the statement. The final maturity of the $200 million loan from the International Bank for Reconstruction and Development (IBRD), including the grace period of 4.5 years, is 14.5 years.