Rajasthan Renewable Energy Transmission Investment Program FACT SHEET

The Indian State of will soon be generating and transmitting up to 8,000 megawatts (MW) of renewable energy to the state and national grid. The Government of , the Asian Development Bank (ADB), and the Clean Technology Fund support this effort through the $800 million Rajasthan Renewable Energy Transmission Investment Program (RRETIP), which also provides livelihood opportunities for local communities.

India and Renewable Energy Highlights India’s electricity generation capacity is still dominated by coal, but in 2016–2017 and 2017–2018 renewable energy capacity ADB—A Partner in Rajasthan’s Renewable Transformation additions already exceeded thermal capacity additions. By March ADB’s RRETIP helps finance the development of a transmission 2018, renewable energy installed capacity had reached 70 gigawatt network that can support the evacuation of new renewable energy (GW)1 with additional 40 GW under implementation. capacity. By delivering solar and wind energy to the state and national grids, the program enables a cleaner electricity mix and a Solar energy capacity increased by over eight times, from 2.6 GW more efficient generation and transmission system, while avoiding in 2014 to 22 GW in 2018. In varying stages of development are greenhouse gas emissions. As of March 2018, the first tranche4 of 41 solar parks in 21 states, with aggregate capacity of over 26 GW. RRETIP has completed (i) construction of new 400 kilovolt (kV) grid Based on the early success of the solar park model, the government substations in Bhadla and Ramgarh; (ii) augmentation of existing has doubled its solar parks target from 20 GW to 40 GW.2 This is 400 kV grid substations in Akal and Bikaner; (iii) construction of achievable, provided constraints in the transmission system can be the 91 kilometer 400 kV Ramgarh–Akal transmission line; and addressed in a timely manner. (iv) construction of a substantial part of the 220 kilometer, 400 kV transmission line from Bhadla to the “line-in-line-out” point of the Rajasthan – The Perfect Place for Solar Power3 Jodhpur–Merta transmission line.

Due to its geographical and environmental advantages, Rajasthan has The technical assistance component (i) developed the solar huge potential for generation. Among the Indian states, park master plan; (ii) implemented community development it has the highest solar irradiation with 5.72 kilowatt-hour per square initiatives around the solar park; (iii) developed the institutional 2 meter per day (kWh/m /day) and the highest solar power potential capacity of Rajasthan Rajya Vidyut Prasaran Nigam Limited, the of 140 GW. In terms of land availability, Rajasthan has vast tracts of state transmission licensee, and Rajasthan Renewable Energy 34 unused, barren, and affordable land. Through its 2014 Solar Energy Corporation, the state government nodal agency responsible for Policy, the state set a target of 25 GW solar capacity. By March 2019, developing renewable energy; and (iv) studied the system for the installed solar capacity in Rajasthan is expected to reach 3 GW. renewable energy integration road map.

1 Composed of 34 GW wind, 22 GW solar, 4.5 GW small hydro power, and 9.5 GW bio-power. 2 Ministry of New and Renewable Energy (press release). “A target of installing 175 GW of renewable energy capacity by the year 2022 has been set.” 19 July 2018. New Delhi. pib.nic.in/newsite/pmreleases.aspx?mincode=28 3 RREC (2018) (powerpoint). “Rajasthan the solar destination & development of Bhadla solar park”. d2oc0ihd6a5bt.cloudfront.net/wp-content/uploads/ sites/837/2018/06/Basant-Dosi-Rajasthan-The-Solar-Destination-and-Development-of-Bhadla-Solar-Park.pdf 4 RRETIP Tranche 1 is composed of $62 million ADB loan, $88 million CTF loan, and $2 million CTF grant for the technical assistance. Bhadla Solar Park: Discovering the Lowest Solar Tariffs in India’s History The desert plains of Bhadla, about 320 km west of Jaipur, are host to Figure 1: Tariff Trend Since the Bhadla Phase I Bidding Rajasthan’s first and largest solar park. Rajasthan Renewable Energy Corporation is developing the Bhadla Solar Park with an area close to 9 5,800 hectares, in a phased manner. Phase I (65 MW) and Phase II 8 (680 MW) are already operational. Phase III (1,000 MW) and Phase 7 a IV (500 MW) will be commissioned by March 2019. When all phases ) h 6 6.45 W are fully operational, the solar park will be capable of producing k 5 s / ( R 2,245 MW of renewable electricity. The RRETIP technical assistance 4 4.34  i r supported the infrastructure planning and implementation of Phase II, a

T 3 high-level master planning for Phase III, and a review of the master 2.62 2 plan for Phase IV. 2.44 1 Solar generation costs have seen a significant downward trend. The 0

3 3 3 3 3 4 4 4 4 5 5 5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6 6 7 7 7 7 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 ' ’ ’ ’ ’ ’ ’ ’ ’ ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' ' Bhadla Phase III auction discovered a record low tariff of Rs. 2.44 per r r y t v r r r y y e g’ g’ t b b n n g' g' p c c c y y b n v v c n n a p c a u e a a a p a a n u u a o o e e u u u e o e e a a a e J J J a M A u J F F J A S O F A A A O M A N D D D M M M M J ; N N ; ; ; ; ; ; ; M M ; ; kWh (~$0.037), the lowest solar tariff in India’s history, to date. ; ; ; ; ; ; , ; ; ; ; I ; ; ; ; ) ; 2 ; ; ) ) 2 h 1 b d ) ) I g; I h ; 2 2 r 2 e e ) 1 1 a a s n g; g; V I s 1 e u e a n e i W W W e p j R e R n n I I e e k n W W s e p m m l i i e e e s p a s s s s a u u n e C m d C l l M M e e s d a a a d e M s a a t o u h a s a a ga M M t h a o h e n d d s a a h a r r k h D h D 0 0 h h n r P h 0 n n a a The solar park model departs from traditional approaches to h r h 4 0 n P a c c ( u 5 5 h P n P r s c P 5 u h h P P P P P r a a G G s e g( u P l 0 B - 7 2 h h a s a P P a h a e n a a a g g n B B - a a h s s t m l i n - l r b s 5-2 y t e l k a s k K T A e n n n n e d k a developing renewable energy projects and achieves greater economies e i i t W r l l d a e 5-1 h l h j e a y l a d W W r t d d U h a ga a d d a d t 2 d ga d n a d n d i C a ga d c t h M n a a a P a a h n a r a y P r n n n n s S u M M P u r c B a h h r n t a 0 l r of scale. Rajasthan’s natural advantage in solar insolation and land B a i T P a u u ( B r A P r P M l l g - 0 0 a ( P P a 0 e a l B B a p c r e B B n 5 l a N e n n 1 0 - - r a a a a i T o n K y T l a - W 3 o n a r t T a 5 n a p t d h - - S availability provides a starting point. Investment from public sector or t h h C W W y P S a a a t h t ( n r M n a a t d d U s a h h U k t a C M M u a p t s U n b a 0 ga s s ( j a w a a a 0 B H t public–private partnerships in early development phase for solar park j A j 0 a 0 n e a a M j j b 5 1 a d a n 0 R a a a 3 - l R a a j 5 W n R u - n e r R R - K P n a a and transmission infrastructure reduces significant project-level risks P M T - u P h P A K P A 0 t MP- 5 s A 1 a to private investment in renewable generation assets. Power purchase j - a P R agreement with credit worthy buyers has proved beneficial. The A reduction in international price of modules and cost of capital have also contributed to the decline in tariffs. The solar park also creates AP = Andhra Pradesh, DCR = domestic content requirement, kWh = kilowatt hour, MP = Madhya Pradesh, opportunities for local businesses and employment in the region. MW = megawatt, NTPC = National Thermal Power Corporation Limited, Rs = Indian rupees. Governments are replicating this model in other parts of India, and Source: Compiled from various reports. other developing countries in Africa, Asia, and Latin America.

a RREC (2018) (powerpoint). “Rajasthan the solar destination & development of Bhadla solar park”. d2oc0ihd6a5bt.cloudfront.net/wp-content/uploads/ sites/837/2018/06/Basant-Dosi-Rajas- than-The-Solar-Destination-and-Development-of-Bhadla-Solar-Park.pdf b This was the exchange rate at the time of auction, May 2017.

Community Development and Gender Initiatives About the Asian Development Bank Rajasthan Renewable Energy Corporation is committed to creating a ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable positive impact in communities that could be directly and indirectly Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. affected by the solar park development, particularly women and Established in 1966, it is owned by 67 members—48 from the region. Its vulnerable communities. This is being supported through: (i) community main instruments for helping its developing member countries are policy development policy and action plans as templates for new projects; dialogue, loans, equity investments, guarantees, grants, and technical assistance. (ii) micro-enterprise development and skills training for women in animal husbandry, and embroidery work and handicrafts; (iii) skills CONTACTS development through bookkeeping, accounting, finance management ADB Headquarters and negotiations training; (iii) provisions for supply of drinking water and Energy Division, South Asia Department solar home lighting system for the community; and (iv) health camps for Climate Change & Disaster Risk Management Division the local community (especially women/girls). Sustainable Development and Climate Change Department 6 ADB Avenue, Mandaluyong City Support from Clean Technology Fund 1550 Metro Manila, Philippines Tel +63 2 632 4444 The $5.4 billion Clean Technology Fund is a funding window of the Fax +63 2 636 4444 Climate Investment Funds, which provides resources to scale up the demonstration, deployment, and transfer of low-carbon technologies India Resident Mission with significant potential for long-term greenhouse gas emissions 4 San Martin Marg, Chanakyapuri, New Delhi 110021, India savings. The Trust Fund Committee has approved about $5 billion PO Box 5331, Chanakyapuri Tel +91 11 2410 7200 for implementation in renewable energy, energy efficiency, and clean Fax +91 11 2687 0945 / 2419 4273 transport projects. In 2013, the Trust Fund Committee approved $200 million allocation for the RRETIP, to be administered by ADB, Rajasthan Renewable Energy Corporation Limited to help finance the transmission infrastructure that will be a foundation E-166, Yudhisthir Marg, C-Scheme, Jaipur, Rajasthan 302001, India for solar and wind power development in Rajasthan, India.5 Tel 91-141-2228198 Fax 91-141-2226028 Email [email protected]

5 Since 2017, ADB ($175 million sector loan) and Clean Technology Fund ($50 million Rajasthan Rajya Vidyut Prasaran Nigam Limited concessional loan) have also been supporting the development of high-voltage Vidyut Bhawan, Janpath, Jaipur - 302 005, Rajasthan, India transmission systems to evacuate electricity generated by new “mega” solar parks to the Tel 0141-2740381 interstate grid, and to improve the reliability of the national grid system. Earlier in 2011, ADB provided a loan for transmitting electricity from the Charanka solar park in Gujarat.