Contacts: In Delhi: Sudip Mozumder (91 11) 2461-7241
smozumder@worldbank.org
In Washington: Erik Nora (202) 458 4735
enora@worldbank.org NEW DELHI, December 17, 2009 ─ A Loan Agreement of US$180 million equivalent for the World Bank supported Coal-fired Generation Rehabilitation Project was signed today. The signatories to the Agreement were Mr. Govind Mohan, Joint Secretary, on behalf of the Government of India, Ms. Giovanna Prennushi, Acting Country Director on behalf of the World Bank and senior government officials from the state governments of Haryana, Maharashtra and West Bengal. The project, which is expected to lower carbon emissions and boost power production at these plants, is co-financed with a US$45.4 million grant from the Global Environment Facility (GEF). It has been designed in partnership with other development partners, such as Kreditanstalt für Wiederaufbau (KfW) and USAID-funded Eco-Asia Clean Development and Climate Program. India’s power shortage is a daunting barrier to the country’s development. More than 40 percent of Indian homes do not have electricity and 60 percent of Indian industrial consumers are forced to make their own arrangements for securing a reliable power supply. For example, in 2007-2008, the country faced a 16.6 percent shortfall during hours of peak consumption and a 9.9 percent gap for energy generation. “More than 400 million people do not have electricity in India,” said Roberto Zagha, World Bank Country Director for India. “Using coal more efficiently and making it less polluting is an important step for India even as the government develops longer term solutions for addressing its climate change concerns.” The Coal-fired Generation Rehabilitation Project will pilot a new approach to renovation and modernization that moves beyond simple life-extension to making the rehabilitated plants more energy efficient and environmentally sustainable. This means the renovated plants will use less fuel (coal) and emit fewer greenhouse gases for every unit of electricity produced. This would be the first step in a decade-long Government of India plan to augment power supply by rehabilitating a range of old coal-fired plants as the country moves to more climate-friendly options for energy generation in the long term. It would complement the country’s efforts to maximize domestic sources of renewable energy and implement energy efficiency measures to address both energy security and climate change issues. “In addition to reducing the transmission and distribution losses, this project would be one of the most critical and effective steps in the Government of India’s strategy to better utilize the existing generation assets to augment power supply to the national grid and provide better services to households and industries,” said Kwawu Mensan Gaba, World Bank Lead Energy Specialist. The project will rehabilitate and modernize around 200-220 MW of capacity at each of the three coal-fired power plants at Bandel in West Bengal, Koradi in Maharashtra, and Panipat in Haryana. It has been designated the first phase of India’s National Renovation and Modernization Program which, over the next decade, aims to rehabilitate old and inefficient power plants with a cumulative capacity of 27,000 MW, or almost one-fifth of India’s installed power capacity of 147,000 MW as of March 2009. “Modernization of these plants can improve their efficiency by about 10 to15 percent,” said Sunil Kumar Khosla, Senior Energy Specialist and project team leader. “The Bank-supported project alone will help India reduce its direct greenhouse emissions by almost half a million tons of CO2 equivalent each year. If scaled up effectively to the remaining similar units needing rehabilitation, India could be looking at emissions cuts anywhere between 10 to 13 million tons of CO2 equivalent each year.” In addition to helping reduce carbon emissions from these units, the project will also support efforts to control particulate emission, and improve water treatment and ash disposal at the plants, leading to better environment conditions for people living in the vicinity. A parallel focus on better operations and maintenance practices in the plants will help sustain the improvements made through the renovation and modernization effort. This combined emphasis will allow India to adopt a lower-carbon path to energy generation by modernizing its coal-fired plants and enabling them to add cheaper and cleaner electricity to its grid. The loan from the International Bank for Reconstruction and Development (IBRD) has a 30 year maturity including a 5-year grace period. # # # For more information about the project: http://go.worldbank.org/WVCZI4TUM0 For more information on the Bank’s work in India: http://www.worldbank.org.in For more information about the Global Environment Facility: http://www.gefweb.org/ |
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