Rooftop Revolution: World Bank Backs India's Solar Push with $890 Million Package
he Board of Executive Directors of the World Bank has agreed on an $890 million financing program for the acceleration of the national rooftop solar program of India, which would help generate power for millions of homes across the country and create employment opportunities in the entire renewable energy value chain. This financial aid would be utilized by the Indian government under its PM Surya Ghar: Muft Bijli Yojana, according to which solar rooftops would be installed in 10 million rural and urban houses in the country.
Financing Package Details
This $890 million financing package comprises of three different components;
- $820 million loan provided by the International Bank for Reconstruction and Development (IBRD),
- $60 million loan from the Clean Technology Fund,
- $10 million grant from the Livable Planet Fund of IBRD.
Apart from this public financing, the World Bank stated that it would mobilize an extra $4.2 billion from the private sector in the form of commercial loans and help households to avail themselves of affordable finance for installing solar roofs.
Employment and Renewable Energy Growth
It is estimated that this new investment will create approximately 1.7 million jobs in the production, deployment, and services segment of the renewables industry chain as India continues to establish itself in its efforts to develop a local solar manufacturing chain in addition to improving energy access via clean sources of energy.
According to Paul Proccee, acting country director for India at World Bank,
"World Bank Group has long been working in the Indian rooftop solar segment. The institution has invested over $2 billion in support of the Indian Rooftop Solar market, helping increase its capacity from 500 MW to over 27 GW."
PM Surya Ghar: Muft Bijli Yojana
Though the utility-scale solar segment in India has seen exponential growth, the uptake in rooftop systems in homes has been relatively poor. The scheme known as 'PM Surya Ghar' was established precisely with this goal in mind, where installing rooftop solar systems not only helps households save on their power bills but also stimulates local production of solar systems.
Progress Under the Scheme
According to a report from early this year, more than 26 lakh installations have taken place through the scheme, and more than Rs 17,967 crore have been paid out in financial support to those benefiting from the scheme. The government is targeting to meet this total figure by 2026-27.
Supporting India's Climate Goals
The financing also reflects India's climate goals, which include achieving net-zero emissions by 2070 and increasing the percentage of non-fossil fuel energy sources to 60% of the country’s electricity consumption by 2035.
