India to invest $1.8 Billion on Lines to Transmit Solar Power

India will invest Rs 127 billion on lines to transmit power from solar parks to enable Prime Minister Narendra Modi’s goal of boosting clean energy capacity to 175 gigawatts by 2022.

The dedicated transmission lines, part of the so-called green corridor project was announced at an event ‘Empowering the Grid to meet Future Challenges’ organized by Power Grid Corporation of India Ltd. (PGCIL) where Renewable Energy Minister Piyush Goyal released reports on ‘Renewable Energy Integration: Transmission, an Enabler’ and ‘Green Energy Corridors – II’ and ‘Electricity Demand Pattern Analysis’.

Piyush Goyal in a series of reports mentioned that the transmission lines will transmit 20 GW of power capacity from 34 solar parks across 21 states. The reports were written by Power Grid Corp. of India Ltd to develop plans to integrate renewable energy on the national grid.

The green-energy corridor is part of the country’s plan to boost transmission capacity to enable a seamless flow of electricity from clean electricity producing states to consuming states that face power shortages. New lines will also help manage intermittency challenges of renewable energy, especially as clean sources increase their share of power generation to almost 50% in some states.

The inter-state portion of the transmission investments will cost Rs80 billion, while intra-state lines will require another Rs47.45 billion, according to the government.

India will receive a soft loan of about €1billion for the corridor’s development from the German development bank KfW.

Intra-state transmission under the plan will be funded through a 20% equity stake held by the state government, 40% in the form of a grant from the National Clean Energy Fund and the soft loan accounting for the remaining 40%. The inter-state transmission schemes are to be funded as 30% equity by Power Grid Corp. and 70% as a soft loan.

Source: Bloomberg