The World Bank on Saturday approved $1.5 billion in financing for a second operation to help India – the world’s fastest-growing major economy – accelerate low-carbon energy development.
The second Low-Carbon Energy Programmatic Development Policy Operation will support reforms to boost the production of green hydrogen and electrolysers, critical technology needed for green hydrogen production.
This operation is aligned with the government’s energy security and the World Bank’s Hydrogen for Development (H4D) Partnership.
The reforms are expected to result in the production of at least 450,000 tonnes of green hydrogen and 1,500 MW of electrolysers per year from FY25/26, the World Bank said.
Moreover, it will also significantly help increase renewable energy capacity and support emissions reduction by 50 million tons per year.
The operation will also support steps to further develop a national carbon credit market.
“The World Bank is pleased to continue supporting India’s low-carbon development strategy, which will help achieve the country’s net-zero target while creating clean energy jobs in the private sector,” said Auguste Tano Kouame, World Bank Country Director for India.
“Both the first and second operations are strongly focused on stimulating private investments in green hydrogen and renewable energy,” Kouame added.
The Indian economy is expected to continue growing at a rapid pace.
According to the World Bank, decoupling economic growth from emissions growth will require scaling up renewable energy, especially in hard-to-abate industrial sectors.
“India has taken bold action to develop a domestic market for green hydrogen, supported by rapidly growing renewable energy capacity,” said Aurelien Kruse, Xiaodong Wang and Surbhi Goyal, team leaders for the operation.
In June 2023, the World Bank approved the first operation worth US$1.5 billion, which supported the exemption of transmission costs for renewable energy in green hydrogen projects, the issuance of a clear path to launch 50 GW of renewable energy tenders annually and to create a legal framework for a national carbon credit market.
