India to Fund $11M Renewable Energy Project in Sri Lanka

On March 2rd, India inked an $11 million grant project with Sri Lanka and a private partner to install hybrid renewable energy infrastructure across three islands off Jaffna peninsula in northern Sri Lanka.

The initiative is the third India-backed energy project coming up in Sri Lanka’s north and east. The National Thermal Power Corporation is spearheading a solar venture in the eastern Sampur town, while the Adani Group is setting up renewable energy projects in Mannar and Pooneryn in the north.

Project Scope

Indian renewable firm U-Solar Clean Energy Solutions has signed a contract to construct the systems in Delft (Neduntheevu), Nainativu and Analaitivu islands with funding from the Indian government.

The Sri Lanka Sustainable Energy Authority will provide local oversight support to the undertaking envisioned under New Delhi’s continued assistance for Colombo’s energy security and economic recovery.

The hybrid energy systems will meet baseload power needs of island communities using solar photovoltaics and wind turbines supported by battery storage solutions. It envisions providing 24×7 clean electricity access to households, commercial establishments and public institutions.

The project includes installing transmission infrastructure, distribution networks, setting up 70 charging stations and providing solar panels to villages. Various sustainability features like LED street lighting, smart meters and microgrids with remote monitoring are also incorporated.

Strategic Relevance

The support aligns with India’s focus on expediting last-mile electricity connectivity across neighborhoods in the Sri Lankan islands located barely 50 kilometers from the Tamil Nadu coast.

It counters earlier efforts three years ago by former Sri Lankan government welcoming Chinese investments into northern islands making India wary of Beijing getting an eastern foothold along its strategic maritime backyard.

The renewable energy grant reiterates New Delhi’s abiding development cooperation commitment to Sri Lanka through financial aid and public infrastructure support. It also approximates Colombo’s pivot from overt Chinese dependency towards a more balanced Indo-Sri Lanka regional dynamic.

Impact of the agreement

The sustainable energy infrastructure project marks yet another milestone in India’s extensive collaboration with crisis-hit Sri Lanka across food, fuel, medicines and livelihood packages since early 2022.

By providing $11 million funding for clean energy transition focused on Jaffna’s Tamil community, New Delhi underlines its neighborhood first policy spanning humanitarian assistance, connectivity infrastructure and community development cooperation during Sri Lanka’s difficult transition.

The grant project also spotlights India’s push for greater renewable energy adoption in regions lacking adequate grid availability. Lessons from here can inform sustainable de-centralized electrification roadmaps for India’s own remote locations.