India and the Asian Development Bank (ADB) have signed a loan agreement to improve the country’s solar power transmission system.
According to IANS, the Finance Ministry said that India and ADB have signed a US$175 million loan agreement to support construction of high-voltage transmission systems to evacuate power generated from new mega solar parks to the interstate grid, and improve reliability of the national grid system.
Speaking on the occasion, Raj Kumar, Joint Secretary in the Finance Ministry, said that by supporting the construction of interstate transmission systems for the mega solar power projects, the project will enable transmission of surplus solar energy from states with surplus power to power-deficit states.
This will be ADB’s first breakthrough of the country system’s application to a specific project.
After signing the loan agreement, Kenichi Yokoyama, Country Director of ADB for India, said the project will support the continued expansion of solar energy in India in line with the government’s objectives and contribute to climate change by increasing the share of clean energy in the power mix besides increasing overall efficiency of the power system.
He said the adoption of POWERGRID’s safeguard and procurement systems would improve its operational flexibility and autonomy, and reduce the transaction costs and time for project preparation and implementation.
As laid-out in the ADB Safeguards Policy, country safeguard systems constitute a country’s legal and institutional framework on environment and social safeguards.
