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This World Bank commitment is a key part of a larger, estimated $1.7 billion effort for the 1,125 MW Dorjilung Hydro Power Ltd (DHPL). The project is designed as an innovative public-private partnership (PPP) to reduce the need for the Bhutanese government to borrow directly. This structure aims to attract an additional $900 million from private investors, covering the project's significant costs with minimal direct debt for the nation.
Economic and Environmental Gains
Bhutan is set to gain significantly from this venture. Over the 30-year credit period provided by the International Development Association (IDA) – the World Bank's fund for developing countries – Bhutan is projected to earn around $4 billion. These earnings will come from taxes, free power shares, and dividends. This income is expected to boost economic growth and support Bhutan's goal of remaining a carbon-negative nation.
Strengthening Regional Energy Security
The project is designed to generate over 4,500 GWh of clean electricity annually, helping Bhutan overcome its energy shortages during winter. Critically, it will supply surplus power to India during the summer and monsoon seasons. With close to 80% of the generated electricity earmarked for India, this project will aid in meeting India's growing energy demand, especially during peak summer months. It also aims to deepen clean energy cooperation between the two countries. Praveer Sinha, CEO & MD of Tata Power, described the commitment as a landmark achievement that bolsters regional energy security.