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The World Bank has approved a USD 815 million long-term financing package for the 1,125 MW Dorjilung Hydropower Project in Bhutan, where Tata Power holds a 40 per cent stake. The remaining 60 per cent interest in the special purpose vehicle is owned by Bhutan's Druk Green Power Corporation. The funding comprises a mix of grants, credits and loans from the World Bank Group, including support from the International Development Association, International Bank for Reconstruction and Development and the International Finance Corporation. The project, structured under a public-private partnership model, is expected to generate over 4,500 GWh of clean electricity annually, with around 80 per cent of output supplied to India. Once operational, the project is expected to significantly expand Bhutan's installed power capacity and strengthen cross-border clean energy trade.
The World Bank has cleared a USD 815 million long-term financing package for the 1,125 MW Dorjilung Hydropower Project in Bhutan, in which Tata Power holds a 40 per cent equity stake. The remaining 60 per cent stake in the special purpose vehicle is held by Druk Green Power Corporation (DGPC), a government-owned utility in Bhutan. The approval was granted by the World Bank's Board of Executive Directors, according to a statement issued by Tata Power. Advertisement
The financing package brings together multiple institutions within the World Bank Group. It includes a USD 150 million grant and a USD 150 million credit from the International Development Association, along with a USD 15 million enclave loan from the International Bank for Reconstruction and Development to DGPC. In addition, Dorjilung Hydro Power Limited will receive a USD 200 million enclave loan from the IBRD and a USD 300 million loan from the International Finance Corporation. Tata Power stated that the remaining funding requirements for the project will be met through arrangements with market participants.
The Dorjilung Hydropower Project is being developed under a public-private partnership model and is set to become Bhutan's largest hydropower project under this structure. Once operational, the project is expected to generate more than 4,500 GWh of clean electricity annually. Around 80 per cent of the electricity generated from the project is planned to be supplied to India, reinforcing Bhutan's role as a key exporter of renewable energy to the Indian market.
Tata Power Trading Company Limited, a wholly owned subsidiary of Tata Power, will be responsible for importing electricity into India and managing its onward distribution. The project is expected to increase Bhutan's installed power generation capacity by nearly 40 per cent, strengthening the country's energy infrastructure and long-term export potential.
Beyond energy generation, the project is also expected to create significant employment opportunities during both the construction and operational phases. It is projected to stimulate local entrepreneurship and support livelihoods in Bhutan's Mongar and Lhuentse districts. The development aligns with broader regional goals of expanding clean energy capacity and enhancing cross-border power cooperation between Bhutan and India.
Source - PTI
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