ADB approves USD 460 million loan for Maharashtra’s agricultural solarisation

The Asian Development Bank (ADB) has approved a USD 460 million results-based loan to upgrade Maharashtra’s rural power infrastructure and promote distributed renewable energy. The initiative aims to provide farmers with reliable daytime solar electricity for irrigation, improving agricultural productivity and supporting the state’s clean energy goals.

The Maharashtra Power Distribution Enhancement Program (MPDEP) for Agricultural Solarisation aligns with the state’s Power Sector Vision 2030, which focuses on expanding renewable energy adoption, strengthening rural energy access, and improving the financial health of the power sector. In addition to the ADB funding, a USD 40 million concessional loan from the Clean Technology Fund, administered by ADB, will complement the program.

According to ADB’s project details, the MPDEP will support the Government of India’s broader climate commitments under its updated Nationally Determined Contributions (NDCs). India aims to reduce the emissions intensity of its GDP by 45% from 2005 levels and achieve 50% of installed power capacity from non-fossil sources by 2030. National measures such as the PM-KUSUM scheme for agricultural pump solarisation, PM-Surya Ghar Muft Bijli Yojana for rooftop solar, and the National Green Hydrogen Mission contribute to this transition.

Maharashtra, India’s largest state economy, faces challenges in meeting its growing power demand. The state recorded a peak demand of about 31 GW in FY2023, of which 29 GW was met, resulting in a 6.8% peak deficit. Maharashtra has an installed generation capacity of 47 GW, comprising 29 GW thermal, 1 GW nuclear, 3 GW hydro, and 14 GW renewable energy. Public sector entities own 22 GW, while private players account for 25 GW, including 13 GW from renewable sources.

To align with India’s decarbonization goals, Maharashtra plans to reduce carbon emission intensity by 45% from 2005 levels, targeting 0.16 kg CO₂ per PPP dollar of GDP by FY2028. The state also aims to raise its renewable energy share to 45% by FY2028 and 50% by FY2030, up from 35% in FY2023.

Under the Power Sector Vision 2030, Maharashtra aims to establish a sustainable, efficient, and customer-centric electricity system. The vision emphasises safety, cost-effectiveness, reliability, digitalisation, and clean energy growth. It identifies three global trends shaping the future of the sector: decarbonisation through renewable energy, decentralisation through rooftop solar and storage, and digitalisation through technologies such as artificial intelligence and machine learning.