1020 MW Punatsangchuu-II Hydroelectric Project to enhance Bhutan’s power generation capacity by 40%: MEA – desitalkchicago.com

Report on the Inauguration of the Punatsangchhu-II Hydroelectric Project

Introduction

On November 12, 2025, a significant milestone in the India-Bhutan bilateral energy partnership was achieved with the formal inauguration of the 1020 MW Punatsangchhu-II Hydroelectric Project (HEP). The ceremony was jointly officiated by the Prime Minister of India, Narendra Modi, and His Majesty Jigme Khesar Namgyel Wangchuck, the King of Bhutan, in Thimpu. This project is a cornerstone of the region’s commitment to sustainable development, directly contributing to several United Nations Sustainable Development Goals (SDGs).

Project Impact and Technical Specifications

Enhanced Energy Capacity and Economic Contribution

The commissioning of the Punatsangchhu-II HEP represents a substantial advancement in Bhutan’s energy infrastructure and economic landscape. The project’s completion aligns directly with key development objectives.

• Power Generation: The project adds 1020 MW of installed capacity, increasing Bhutan’s total power generation capability by approximately 40%.
• Energy Output: Since the commissioning of its six units between December 2024 and August 2025, the facility has supplied over 1.3 billion units of electricity to Bhutan’s national grid.
• Revenue Generation: The project has generated approximately Nu 4.9 billion in revenue, directly supporting Bhutan’s economic growth (SDG 8).
• Project Design: As a run-of-the-river hydropower facility located on the Punatsangchhu River, it is designed to minimize environmental and social impact, a key tenet of sustainable infrastructure.

Bilateral Partnership and Financial Framework

A Model for International Cooperation (SDG 17)

The Punatsangchhu-II project is a testament to the robust and mutually beneficial partnership between India and Bhutan, reflecting a shared vision for sustainable growth as outlined in the 2024 Joint Vision Document. This collaboration is a prime example of SDG 17 (Partnerships for the Goals).

• Total Project Cost: Rs 37,778 million.
• Funding Source: The project was fully funded by the Government of India.
• Financial Structure: The funding was provided through a combination of a 30% grant and a 70% loan at a 10% annual interest rate.

Alignment with Sustainable Development Goals (SDGs)

Advancing a Sustainable Future

The Punatsangchhu-II Hydroelectric Project makes significant contributions to several core Sustainable Development Goals, underscoring its importance beyond energy generation.

1. SDG 7 (Affordable and Clean Energy): The project is a primary driver for this goal, providing a large-scale source of clean, renewable hydroelectric power. It enhances energy security and access for both Bhutan and India, promoting sustainable energy for all.
2. SDG 13 (Climate Action): By generating low-carbon electricity, the project directly contributes to climate change mitigation efforts. It reduces reliance on fossil fuels and supports both nations’ commitments to green growth and low-carbon development.
3. SDG 8 (Decent Work and Economic Growth): The substantial revenue generated from the project fosters sustainable economic growth in Bhutan. The development and operation of such large-scale infrastructure also create employment opportunities.
4. SDG 17 (Partnerships for the Goals): The project’s successful completion, based on a comprehensive financial and technical partnership between India and Bhutan, exemplifies effective international cooperation to achieve shared sustainable development objectives.

Analysis of Sustainable Development Goals (SDGs) in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 7: Affordable and Clean Energy

  The article’s central theme is the inauguration of the 1020 MW Punatsangchhu-II Hydroelectric Project. This directly relates to SDG 7 as hydropower is a form of clean and renewable energy. The project aims to increase Bhutan’s power generation capacity and supply electricity to both Bhutan and India, addressing the goal of ensuring access to modern and clean energy.

• SDG 13: Climate Action

  The project is described as a step towards “clean power generation,” “climate resilience,” “green growth,” and “low-carbon development.” By providing a large-scale renewable energy source, the hydroelectric project helps in mitigating climate change by reducing reliance on fossil fuels, which is a core objective of SDG 13.

• SDG 17: Partnerships for the Goals

  The article repeatedly emphasizes the collaborative nature of the project, calling it a “dynamic and mutually beneficial – energy partnership” and a “milestone” in “India-Bhutan clean energy collaboration.” The funding model, where the Government of India fully financed the project for Bhutan, is a clear example of a bilateral partnership to achieve sustainable development, which is the essence of SDG 17.

• SDG 8: Decent Work and Economic Growth

  The project contributes to Bhutan’s economic growth by generating substantial revenue. The article states that the project has already generated “around Nu 4.9 billion in revenue.” This economic benefit, derived from a sustainable infrastructure project, aligns with the goal of promoting sustained, inclusive, and sustainable economic growth.

2. What specific targets under those SDGs can be identified based on the article’s content?

• Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.

  The article explicitly states that the 1020 MW hydroelectric project “enhances Bhutan’s power generation capacity by 40%,” directly contributing to increasing the share of renewable energy in the country’s energy mix.

• Target 7.a: By 2030, enhance international cooperation to facilitate access to clean energy research and technology… and promote investment in energy infrastructure and clean energy technology.

  The project is a result of the “India-Bhutan energy partnership,” with the Government of India providing the full funding (Rs 37,778 million) for the energy infrastructure in Bhutan. This is a direct example of international cooperation and investment in clean energy technology.

• Target 13.2: Integrate climate change measures into national policies, strategies and planning.

  The project is framed as aligning with “shared regional priorities for green growth and low-carbon development,” implying that such clean energy initiatives are part of the national and regional strategies to address climate change.

• Target 17.9: Enhance international support for implementing effective and targeted capacity-building in developing countries to support national plans to implement all the sustainable development goals.

  India’s financial support, provided as a 30% grant and a 70% loan, is a form of international support that builds Bhutan’s capacity in the clean energy sector, helping it achieve its sustainable development goals.

• Target 8.4: Improve progressively, through 2030, global resource efficiency in consumption and production and endeavour to decouple economic growth from environmental degradation.

  The project is described as a “run-of-the-river” facility that “minimises environmental and social impact” while promoting “green growth.” This demonstrates an effort to achieve economic growth (through revenue generation) without causing significant environmental degradation.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Increase in renewable energy capacity: The article specifies the project’s total installed capacity is “1020 MW” and that it increases Bhutan’s total power generation capacity by “nearly 40 per cent.” This is a direct indicator for progress towards Target 7.2.
• Amount of clean electricity generated: The article mentions that the six units have supplied “more than 1.3 billion units of electricity to Bhutan’s national grid.” This quantifies the output of the clean energy project.
• Financial flows for sustainable development: The article states the project was “entirely funded by the Government of India” at a “total cost of Rs 37,778 million.” This dollar value of financial assistance is a key indicator for international cooperation under SDG 17.
• Revenue generated from sustainable sources: The project has generated “around Nu 4.9 billion in revenue.” This figure serves as an indicator of the economic growth (SDG 8) achieved through sustainable and green initiatives.

4. Table of SDGs, Targets, and Indicators

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