On Saturday, the World Bank sanctioned $1.5 billion in funding for a new initiative aimed at accelerating the development of low-carbon energy in India, the fastest-growing large economy globally. This funding will support the second phase of the ‘Low-Carbon Energy Programmatic Development Policy Operation’, which aims to advance reforms necessary for the production of green hydrogen and electrolysers—key technologies for green hydrogen generation.
This initiative aligns with India’s energy security goals and the World Bank’s Hydrogen for Development (H4D) Partnership. The World Bank expects these reforms to facilitate the production of at least 450,000 metric tonnes of green hydrogen and 1,500 MW of electrolysers annually starting from FY25/26.
Additionally, the operation is anticipated to significantly enhance renewable energy capacity and contribute to a reduction of emissions by 50 million tonnes per year. It will also support the development of 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 focused on boosting private investment in green hydrogen and renewable energy.”
India’s economy is projected to continue its rapid expansion. The World Bank notes that decoupling economic growth from emissions growth will require a significant increase in renewable energy, especially in hard-to-abate industrial sectors.
“India has taken bold action to develop a domestic market for green hydrogen, underpinned by rapidly expanding renewable energy capacity,” stated Aurelien Kruse, Xiaodong Wang, and Surbhi Goyal, team leaders for the operation.
In June 2023, the World Bank approved the initial $1.5 billion phase, which supported initiatives such as waiving transmission charges for renewable energy in green hydrogen projects, launching 50 GW of renewable energy tenders annually, and creating a legal framework for a national carbon credit market.
