Speed Post News Network
New Delhi : The Government of India and the Asian Development Bank (ADB) signed here a $175 million loan agreement on April 6, 2017, 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.
The loan will be given to the Power Grid Corporation of India Limited (POWERGRID) and will include sub-projects at various locations in India. As an innovative feature, the project is designed to adopt the country systems on both safeguards and procurement at the agency level. This will be the ADB’s first breakthrough of the country system’s application to a specific project.
Raj Kumar, Joint Secretary (Multilateral Institutions), Department of Economic Affairs, Ministry of Finance, signed the agreement on behalf of the Government of India while Kenichi Yokoyama, Country Director of ADB’s India Resident Mission signed for ADB.
Speaking on the occasion, Raj Kumar, Joint Secretary, 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. After signing the loan agreement, Kenichi Yokoyama, Country Director of ADB for India, said that the project will support the continued expansion of solar energy in India in line with the Government of India’s objectives, and contribute to climate change by increasing share of clean energy in the power mix besides increasing overall efficiency of the power system, according to a PIB release.
He said that the adoption of POWERGRID’s safeguard and procurement systems will 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.