Reliance Power has formalized a commercial term sheet with Bhutan-based Green Digital Pvt Ltd—owned by Druk Holding and Investments Ltd (DHI), the sovereign investment arm of the Royal Government of Bhutan—for a landmark renewable energy project. The 500 MW solar venture, jointly developed on a 50:50 basis, represents Bhutan’s largest solar energy initiative and the most significant private-sector foreign direct investment (FDI) in its solar sector to date. With a projected outlay of up to Rs. 2,000 crore, the initiative is expected to advance cross-border clean energy integration, diversify Bhutan's energy mix beyond hydropower, and reinforce regional sustainability goals.
A Strategic Bilateral Partnership for Energy Transformation
In a move that could redefine renewable energy collaboration in South Asia, Reliance Power has signed a commercial term sheet with Bhutan’s Green Digital Pvt Ltd for the joint development of a 500 MW solar power project. The initiative marks a major stride in bilateral clean energy cooperation and underscores the strategic commitment of both parties toward energy transition and sustainability.
Green Digital Pvt Ltd is wholly owned by Druk Holding and Investments Ltd (DHI), the sovereign wealth fund and investment arm of the Royal Government of Bhutan. Through a 50:50 equity structure, Reliance Power and DHI will spearhead the development, execution, and operation of what will become Bhutan’s largest solar power installation to date.
Capital Outlay and Structural Model
The project, with a capital expenditure of up to Rs. 2,000 crore, will be executed under the Build-Own-Operate (BOO) model. This approach ensures long-term private sector involvement while optimizing operational efficiencies and technological competitiveness.
This Rs. 2,000 crore investment also stands out as the single largest private-sector FDI in Bhutan’s solar segment, reinforcing investor confidence in the Himalayan nation’s evolving renewable energy ecosystem.
Project Execution and Financing Strategy
Reliance Power has commenced the Engineering, Procurement, and Construction (EPC) tendering process, aligning with global competitive bidding norms to secure high-caliber technical capabilities and cost-effective execution. This ensures transparency and maximizes long-term operational sustainability.
Simultaneously, the company is engaging with global and regional financial institutions to secure long-tenor, environmentally sustainable project financing. The goal is to develop a capital structure that balances affordability with long-term financial resilience, making the solar asset financially viable and future-ready.
Regional Impact and Sustainability Objectives
This collaboration goes beyond bilateral business. It aligns with Bhutan’s national sustainability blueprint and broader South Asian energy security objectives. Once operational, the solar facility will dramatically boost Bhutan’s solar power capacity, which has historically been dominated by hydropower.
The project is expected to enhance grid stability, reduce seasonal energy volatility, and contribute significantly to Bhutan’s ambition to become a diversified clean energy hub in the region. It also underscores India's evolving role as a regional leader in renewable energy technology and infrastructure exports.
Integration with Broader Energy Portfolio
The solar project forms part of a wider strategic energy collaboration between Reliance and DHI. In October 2024, Reliance Enterprises—jointly promoted by Reliance Power Ltd and Reliance Infrastructure Ltd—entered into a framework agreement with DHI to co-develop both solar and hydropower assets.
This includes the long-term development and operation of the 770 MW Chamkharchhu-I hydroelectric project, a run-of-the-river facility structured under a concession model. Together, these initiatives represent a holistic approach to energy development in Bhutan, incorporating base-load hydropower with solar diversification to build a more balanced and resilient energy grid.
Looking Ahead: Energy Diplomacy and Regional Integration
This landmark partnership is emblematic of a growing trend in energy diplomacy—where public-private partnerships transcend borders to achieve shared sustainability goals. With geopolitical momentum building around clean energy integration in South Asia, such cross-border collaborations could become the cornerstone of a more unified, climate-resilient regional grid.
For Bhutan, the initiative offers a gateway to energy diversification and export potential. For India, it strengthens diplomatic ties and affirms its position as a technological enabler and sustainable development partner. Ultimately, this project may serve as a model for regional renewable energy investments in emerging economies.
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