ADB in $700m Indian ‘green’ push

The loans will help the country carry out $1.4bn of rooftop solar and energy efficiency projects.

The Asian Development Bank will provide $500 million in financing for rooftop solar systems and a $200 million loan to fund the installation of streetlights and water pumps in India, according to two recent announcements. 

The bank will provide the financing for rooftop solar systems to Punjab National Bank, one of India’s largest commercial banks. Through it, the ADB funds will support developers and end users to install rooftop solar systems. 

The facility comprises $330 million from the ADB and $170 million from the multi-donor Clean Technology Fund administered by the ADB. Combined with an additional $300 million in project equity investment and $200 million in loans from commercial banks and other financiers, the whole solar rooftop investment programme has a total cost of $1 billion. The Indian government wants to build 40GW of rooftop solar by 2022.   

For its part, the $200 million loan will help install energy efficient lights in streets and homes and water pumps in farms across India. The bank said it could lead to energy savings equivalent to the annual output of two 300MW coal-fired power stations. 

The ADB funds will be channeled through the Energy Efficiency Services – a joint venture between four public sector bodies including the National Thermal Power Corporation, Powergrid Corporation of India, Power Finance Corporation, and Rural Electrification Corporation – which will also deploy a further $200 million of its own to finance energy service projects. The $400 million project will install 1.5 million LED street lamps, 42 million LED household lights, ceiling fans and tube lights, as well as 225,0000 new pumps. 

The ADB said it hoped this would attract more investment into energy efficiency. The JV has a longer-term target of installing 4.5 million streetlights, 700 million bulbs, and 6 million pumps by 2020, which would require more than $12 billion of investment, while the Indian government has launched initiatives in a bid to unlock the market for energy efficiency projects, which the Manila-based multilateral estimates at more than $11 billion.