Loan approved by World Bank to support rooftop solar program

The World Bank Board on 13 May 2016 approved a 625 million US dollars loan to support the India’s program to generate electricity from widespread installation of rooftop solar photo-voltaic (PV). The Board also approved a co-financing loan of 120 million US dollars on concessional terms and a 5 million US dollars grant from Climate Investment Fund’s (CIF) Clean Technology Fund. Highlights of IBRD-CIF loan of World Bank • This IBRD-CIF loan has been designed to tackle a number of these barriers. • It will support a number of solar PV business models, to expand the reach of rooftop PV systems to a variety of customer groups. • The loan, from the International Bank for Reconstruction and Development (IBRD), has a 19.5 year grace period, and a maturity of 20 years. • Loan from CIF’s Clean Technology Fund has a 10 year grace period and a maturity of 40 years. Highlights of India's Rooftop Solar Project • The project will finance the installation of at least 400 MW of Grid Connected Rooftop Solar Photovoltaic (GRPV) across India. • The solar PV installations will provide clean, renewable energy and will reduce greenhouse gas emissions by displacing thermal generation. • The project will be implemented by the State Bank of India (SBI). SBI will on-lend funds to solar PV developers/aggregators and end-users. • Financing will be provided to those with sound technical capacity, relevant experience and creditworthiness as per SBI standards. Why there is the need of Rooftop Solar PV systems in India? Frequent energy shortages and high cost of backup supply in India are the reasons behind the need of rooftop solar PV systems. Until now, those who wanted to install solar rooftop PV systems had to pay the full cost up-front. Aided by government policy and declining costs, rooftop solar has the potential to transform the energy sector. The overall potential demand for rooftop solar is estimated at about 124000 MW. Position of Electricity grid of India • India is one of the lowest per capita consumers of electricity in the world. • Over 200 million people remain unconnected to the electricity grid, and those who are, they continue to face frequent disruptions. • Power shortages also affect industrial output with many industries and manufacturers relying on expensive and polluting diesel-based back-up power supplies.