The World Bank has approved an $815 million long-term financing package for the 1,125 MW Dorjilung Hydropower Project in Bhutan, a project backed by Tata Power, which holds a 40% stake.
The remaining 60% stake in the project’s special purpose vehicle is owned by Bhutan’s state run Druk Green Power Corporation (DGPC).
Tata Power said the World Bank’s Board of Executive Directors has approved the financing for the project, which will be developed under a public-private partnership (PPP) framework.
Financing Structure
The approved funding package includes:
- $150 million grant from the International Development Association (IDA)
- $150 million credit from IDA
- $15 million enclave loan from the International Bank for Reconstruction and Development (IBRD) to DGPC
The remaining funding requirement for the project will be mobilised from market participants and other financial sources, the company said.
Power Offtake and Project Significance
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 Dorjilung Hydropower Project will be Bhutan’s largest hydropower project developed under a PPP model and is expected to generate over 4,500 GWh of clean electricity annually.
Around 80% of the electricity output from the project will be supplied to India, strengthening cross-border energy cooperation between the two countries.
Impact on Bhutan’s Energy Sector
Once operational, the project will expand Bhutan’s installed power capacity by nearly 40%, reinforcing the country’s position as a reliable exporter of renewable energy to India.
The project is also expected to generate substantial employment during construction and operations, stimulate local entrepreneurship, and support livelihoods in Bhutan’s Mongar and Lhuentse districts.
Why It Matters
The approval underscores the World Bank’s continued support for clean energy infrastructure in South Asia and highlights the growing role of Indian private sector participation in regional renewable power projects.
Follow Startupbydoc for daily startup insights, funding news, IPO analysis, and business breakdowns.