Bhutan signs agreement with European Investment Bank for 150 million Euros loan

Bhutan signed an agreement with the European Investment Bank, EIB on Thursday for a loan of 150 million Euros. This marks the first-ever EIB project on Supporting Reliable, Green Energy for Communities in Bhutan. The amount will be used to support the development of solar photovoltaic and hydropower plants in Bhutan.

The agreement was signed by Finance Secretary Leki Wangmo and acting EIB Global Managing Director Markus Berndt in the presence of Nadia Calviño, the EIB president, in the United States.

According to a press release from the Ministry of Finance, the amount will be used in constructing small to mid-size run-of-the-river hydropower plants and solar photovoltaic installation, which in turn is expected to diversify Bhutan’s renewable energy generation.

According to the press release, the president of the European Investment Bank talked about the dynamic importance of such agreements. He said that “bringing green, reliable, and affordable energy to communities around the world, especially in more remote regions, has huge benefits not just in environmental terms but also by improving access to health, education, and economic activity.”

Meanwhile, the press release says that finance minister, Lekey Dorji highlighted the importance of the agreement for Bhutan in maintaining its carbon neutrality. He said that “As Bhutan strives to maintain its carbon-negative status amidst rising global challenges, this partnership not only strengthens Bhutan’s renewable energy sector but also contributes to the broader regional and global effort in combating climate change.”

According to pv magazine, a global solar and storage media platform, the loan with a tenure of 30 years, will support the generation of around 310 megawatts of new renewable energy to help remote regions in Bhutan. According to the magazine, Druk Green Power Corporation will be tasked with the implementation of the new projects.

Karma Samten Wangda

Edited by Kipchu 

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