Generous World Bank solar loan is gamechanger
Clean energy has been one of the most important elements in Prime Minister Narendra Modi's plan for fast paced but sustainable development in India. And this sector just received a huge boost with the World Bank's generous billion dollar loan for the financial year ending 2017. This is the World Bank's largest-ever funding package for solar energy in any country and will go long way in implementing India's ambitious plan to generate 100 GW by 2022.
To understand exactly how ambitious a target it is, factor this: As of 2014, the entire world's total installed solar power capacity was less than double that amount — at just 181 GW. In India, the Government reported in June 2015 that the country had an operational solar power capacity of over four gigawatts. And before you scoff at this figure, remember that this actually a big deal because it made India one of the world's top 10 solar markets. The benefits of going clean and green need no explanation.
But in India's case, the move is not just about protecting the environment for future generations, it is about saving and improving the lives of millions of people today. First, clean energy is the most important weapon in India's fight against climate change which is already threatening thousands of individuals, most of whom are poor but living on the frontlines. Second, as India's population grows and the country accelerates its march to development, it will be impossible to meet the burgeoning demand for energy without dramatically increasing energy supply. India has to optimise every energy option on the table. For the time being, yes, this includes non-renewables which still make for the large chunk of India’s energy basket but it also means doubling down on solar and other forms of clean energy.
India, particularly under the Modi Government, has taken major steps in this regard at home and abroad. The International Solar Alliance, which brings together 121 countries and aims to mobilise one trillion dollar in investments for solar projects by 2030, is, of course, the show-stopper. Apart from buttressing India's leadership credentials on the world stage, this project (supported by the World Bank) can galvanise the solar market which currently suffers from low returns of investment.
At home, while Gujarat and even Rajasthan have been leveraging solar energy for years, other States are now catching up. Karnataka, for instance, is setting up the world's largest solar park with a 2GW capacity. Madhya Pradesh, with an installed capacity of 564 MW, is already home to the country's largest solar project developed by a single company, the 151MW Welspun Solar MP project in Neemuch district. And is also well on its way to setting up the world's largest single-site solar power project. Notably, this 750MW ultra-mega project is supported by the World Bank's private sector arm, the International Finance Corporation which, in fact, had helped India develop its first grid-connected solar power project.