| Finance
clean energy ventures. Eliminating these hindrances will facilitate emerging and developing economies in reaping greater advantages from the potential offered by the evolving global energy landscape.
Country examples One country that has seen funding recently approved
for renewable energy developments is India. Earlier this year the World Bank’s Board of Executive Directors approved a loan of $200 million to the Government of Himachal Pradesh to facilitate power sector reforms in the state and increase the share of renewable energy in the state’s electricity generation. This will contribute to the state’s overall aim of adding 10GW of additional renewable energy capacity to make the state’s power supply greener.
Himachal Pradesh aims to become a ‘Green
State’ by meeting 100% of its energy needs through renewable and green energy by 2030. Himachal Pradesh currently meets more than 80% of its energy demands from hydropower. The World Bank’s Himachal Pradesh Power Sector Development Program will help the state enhance the utilization of its existing renewable energy resources, including hydropower, and help to diversify its renewable energy resources further. For instance, it will add 150MW of solar capacity in the state, reducing greenhouse gas emissions by more than 190,000 metric tons per year. “The Program will boost local economic activity
while replacing fossil-fuel based energy consumption with green energy,” said Auguste Tano Kouamé, the World Bank’s Country Director for India. “Moreover, the Program will support Himachal Pradesh to set up a single energy trading desk, thus enabling the sale of surplus hydropower to other states.” More importantly, the Program 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 Program 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 renewable energy. 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 minimize consumer complaints. The Program will help strengthen environmental, social, financial management, corporate governance, and procurement capabilities of the state’s power sector utilities and agencies. In addition, it will contribute towards creating job opportunities in specialized technical and managerial fields in the sector, especially for women. Power utilities will train around 700 female apprentices throughout the lifespan of the program, giving them hands- on exposure and training in technical roles within the power sector. This will build on the National Apprentice Promotion Scheme implemented by the Ministry of Skill Development and Entrepreneurship. “The Program 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 Program. “This shall contribute towards the state’s goal to be one of the first ‘Green State’ in the country.” The $200 million loan from the International Bank for Reconstruction and Development (IBRD) has a final maturity of 14.5 years including a grace period of 4.5 years. Elsewhere, the New Development Bank (NDB) and the Trans-Caledon Tunnel Authority (TCTA) have officially inked a Loan Agreement to facilitate the execution of Phase II of the Lesotho Highlands Water Project (LHWP). Within this agreement, the NDB has committed to extending a project loan amounting to ZAR 3.2 billion to the TCTA, with the sovereign guarantee of South Africa supporting the arrangement. The Loan Agreement, signed on the sidelines of the 15th BRICS Summit in Johannesburg, witnessed the signatures of Mr. Vladimir Kazbekov, NDB’s Vice President and Chief Operating Officer, and Mr. Percy Sechemane, Chief Executive Officer of TCTA. Representing Mr. Sechemane, Mr. Nhlanhla Nkabinde, Executive Manager for Project Finance & Treasury, also joined the momentous occasion. The TCTA, a state-owned entity tasked with financing and implementing large-scale raw water infrastructure projects, will allocate the received funds toward the construction of the Polihali Dam and reservoir, a 38-kilometer water transfer tunnel, vital road and bridge networks, telecommunications infrastructure, and comprehensive developmental utilities in Lesotho.
By enhancing the yield of the Vaal River Basin by nearly 15% in the long term, the LHWP Phase II is set to not only bolster economic growth but also foster sustainable livelihoods for Gauteng’s populace. Gauteng, a highly urbanized province with 15 million residents (accounting for a quarter of the nation’s population), contributes a substantial 36% to South Africa’s GDP. Furthermore, the positive impacts of this venture will extend directly to the North- West, Mpumalanga, and Free State provinces, all benefiting from the increased water supply that the project will deliver. The collaborative endeavor will see the co-financing efforts of the NDB, African Development Bank (AfDB), and other financiers. “This is the first project financed by NDB outside of BRICS countries and it supports South Africa’s
www.waterpowermagazine.com | September 2023 | 39
Above: The World Bank has approved $200 million to the Government of Himachal Pradesh to facilitate power sector reforms in the state and increase the share of renewable energy
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