Bhutan Gets $160 M Boost for 310 MW Solar

Bhutan’s $160 M Solar Leap

Bhutan has secured a US$160 million loan from the Asian Development Bank (ADB) to build three utility‑scale solar farms totalling 310 MW, marking the country’s first private‑majority public‑private partnership in the energy sector. The funding will cover most of the capital costs and is expected to unlock an additional US$68.7 million of private equity and debt.

Funding and Partners

The ADB loan, approved as ordinary capital resources, will finance the construction of the 120 MW Wobthang and 40 MW Pedseling farms in Bumthang (northern Bhutan) and the 150 MW Dramthang farm in Lhuentse (northeastern Bhutan). Bhutan‑based Druk Green Power Corporation (DGPC) will develop the first two farms, while the third will be a joint venture between DGPC and India’s Tata Power Renewable Energy Ltd. The state‑owned Bhutan Power Corporation will build 46 km of transmission lines to connect the farms to the national grid.

Additional support comes from a US$500,000 grant from Japan’s Innovative Finance Facility for Climate in Asia and the Pacific for training and scholarships, plus a US$1 million technical assistance grant from the ADB’s Special Fund.

“By scaling up solar alongside hydropower, Bhutan can cut costly electricity imports and create green jobs for women and youth,” said ADB Country Director for Bhutan Sonomi Tanaka.

(Information from the ADB press release and PV Magazine’s report.)

Project Scale and Expected Output

The three farms together will add 310 MW of solar capacity, a substantial increase for Bhutan’s renewable energy mix and a step toward reducing winter electricity deficits. Bhutan’s cumulative solar capacity rose to 21 MW by the end of 2025, up from just 3 MW a year earlier, after commissioning its first utility‑scale 17.38 MW plant in mid‑2025 (IRENA data). The new 310 MW projects push the country toward its 5 GW solar target for 2040.

Why the Partnership Matters

This is Bhutan’s first “private‑majority” PPP in the power sector, meaning private investors hold the majority equity while the public utility provides grid access and transmission. The structure is designed to attract commercial debt and equity, reduce the fiscal burden on the government, and accelerate deployment of renewable energy.

The ADB expects its loan to catalyze US$68.7 million of additional private financing, demonstrating confidence from international investors in Bhutan’s regulatory environment and its long‑term hydropower‑backed grid stability.

What It Means for Israel

For Israeli readers, the Bhutan project illustrates how a modest‑cost solar investment can dramatically expand clean‑energy supply. Using Israel’s typical residential tariff of ₪0.48/kWh and a turnkey cost of ₪3,150/kWp, a 1 MW solar plant in Israel would cost about ₪3.15 million and generate roughly 1.7 GWh/year in the central region (1,700 kWh/kWp × 1,000 kW). That translates to annual revenue of about ₪816,000 and a simple payback of just under 4 years – comparable to the economics Bhutan is achieving with far lower capital costs thanks to ADB financing.

The Bhutan example also shows the power of PPPs to mobilise private capital for large‑scale renewables, a model that could be replicated in Israel’s own 30 % renewable‑energy‑by‑2030 target. Investors and developers can look to similar financing structures to de‑risk projects and accelerate the rollout of utility‑scale solar across the country.

Outlook

Construction is expected to begin soon, with the farms coming online in the coming years, delivering clean power that will reduce Bhutan’s reliance on costly winter imports and create green jobs. The success of this financing model could spur further ADB‑backed renewable projects in the Himalayas and beyond, reinforcing the region’s transition to a low‑carbon future.

---

Sources: PV Magazine, Asian Development Bank press release, IRENA statistics