Reliance Power announced on Monday that it has signed a commercial term sheet for a long-term power purchase agreement with Green Digital Pvt Ltd, a subsidiary of Druk Holding and Investments Ltd (DHI), the investment arm of the Royal Government of Bhutan. The two companies will collaborate to develop Bhutan’s largest solar power project, with a total capacity of 500 MW, in a joint venture structured on a 50:50 basis.
The project will involve a capital investment of up to Rs 2,000 crores under the Build-Own-Operate (BOO) model, marking the largest private foreign direct investment (FDI) in Bhutan’s solar energy sector to date. This initiative is set to contribute significantly to regional clean energy integration and foster stronger cross-border infrastructure cooperation across South Asia.
Reliance Power has already begun the Engineering, Procurement, and Construction (EPC) tendering process, following international competitive bidding standards to ensure effective technical execution and cost-efficiency. Additionally, the company has initiated discussions with leading financial institutions to secure sustainable, long-term financing solutions aimed at optimizing the capital structure and improving overall financial efficiency.
The project will be rolled out in phases over the next 24 months, in alignment with Bhutan’s sustainability goals and the broader energy transition agenda across South Asia. Once completed, the project will significantly boost Bhutan’s solar power generation capacity, surpassing all existing installations, and diversify the country’s renewable energy mix beyond hydropower, improving grid stability and integration.
In October 2024, Reliance Enterprises, a joint venture of Reliance Power Ltd and Reliance Infrastructure Ltd, partnered with DHI Ltd to develop solar and hydropower projects in Bhutan. This collaboration includes the 500 MW solar power initiative and the long-term operation of the 770 MW Chamkharchhu-I hydroelectric project, a run-of-the-river asset aligned with Bhutan’s national energy strategy.
