The aim is to develop 1,270 MW hydro and solar power projects

YK Poudel

Paro-Bhutan has taken a major step toward expanding its renewable energy portfolio with the signing of a Memorandum of Understanding (MoU) at the Bhutan Innovation Forum between Druk Holding and Investments Ltd. (DHI) and the Reliance Group. The agreement sets the stage for the development of 500 megawatts (MW) of solar power and 770 MW of hydropower projects (1.2 gigawatts), with an investments of up to USD 1 billion.

As one of India’s largest conglomerates, Reliance Group brings significant expertise to the partnership, particularly through its subsidiary, Reliance Power.

The company has a robust presence in the energy sector, with a total installed capacity of 5,340 MW, including the 4,000 MW Ultra Mega Power Project in Sasan, Madhya Pradesh—the world’s largest integrated thermal power plant.

This collaboration is expected to bolster Bhutan’s energy ambitions and strengthen regional co-operation in sustainable power generation.

The MoU was signed coinciding with the celebration of Gandhi Jayanti, which honours the birth of Mahatma Gandhi, a key leader of India’s independence movement and a pioneer of non-violence.

Prime Minister Dasho Tshering Tobgay, Energy Minister, Secretary of energy ministry, and other senior government officials attended the signing ceremony.

Anil Ambani, chairman of Reliance Group, was also present, along with other officials from the conglomerate.

Lyonchhen Tshering Tobgay said that the signing was the start of a transformative journey, one that aimed at making Bhutan a developed and prosperous nation through sustainable energy projects.

“Reliance in Bhutan, along with DHI, would foster growth and prosperity through green and renewable energy, enhancing the solar and hydropower sectors ahead,” he said.

Lyonchhen said that, currently, over 80 percent of Bhutan’s trade in all sectors is with India. “For the renewable energy sector, India has the demand and market, while Bhutan has the potential for production.”

Anil Ambani said that through this signing, the company and DHI would be dedicated to promoting and investing in the clean and green energy sector in Bhutan. “The Group will set up a new company, Reliance Enterprises, dedicated exclusively to promoting investment in Bhutan’s renewable and green energy sector.”

Reliance Enterprises is jointly promoted by Reliance Infrastructure Ltd. and Reliance Power Ltd.

“These projects will boost Bhutan’s economic and industrial growth, enhancing the country’s energy security with clean, green, and reliable power,” he said.

This represented one of the mega investments in Bhutan’s Gelephu Mindfulness City, a Special Administrative Zone, and is one of the largest foreign direct investments (FDI) by a private company in the renewable energy sector in Bhutan.

Under the agreement, Reliance Group and DHI will jointly develop 500 MW of solar and 770 MW of hydropower projects in Bhutan.

The 500 MW solar project, to be located in Gelephu Mindfulness City, will be developed in two phases of 250 MW each over the next two years. Upon completion, it will be the largest solar installation in Bhutan, surpassing all existing projects and contributing to the country’s efforts in producing clean, renewable energy to combat climate change.

A media release confirmed that land for the project has already been earmarked, and a technical team, consisting of experts from Reliance, DHI, and external consultants, is currently conducting site assessments and technical studies. The project is set to become one of the largest investments in Bhutan’s renewable energy sector and represents the largest FDI by an Indian company in Bhutan.

Reliance Power Ltd. and DHI are set to jointly develop the 770 MW Chamkharchhu-1 project, classified as a run-of-the-river project.

Given Bhutan’s current installed power generation capacity of 2,452 MW, this initiative is particularly significant as it marks a collaboration between Bhutan and a private Indian company. In this joint venture, Reliance Power will hold a 49 percent stake, while DHI will maintain majority ownership with a 51 percent share. The project will operate under a concession model in line with the government’s policies

Ujjwal Deep Dahal, CEO of DHI, emphasised the importance of the energy sector as a key pillar of Bhutan’s economy and highlighted how this partnership will strengthen it. “The collaboration between Reliance Group and DHI will prioritise green energy generation, particularly in solar and hydropower, while also exploring innovative green technologies,” he said.

Further, Reliance Infrastructure Ltd. plans to work alongside government-owned companies in Bhutan to implement infrastructure projects that support the country’s net-zero goals, reinforcing the commitment to sustainable development.

Reliance Group has announced the launch of a new flagship company, Reliance Enterprises, aimed specifically at fostering investment in Bhutan’s renewable and green energy sector. Jointly promoted by Reliance Infrastructure Ltd. and Reliance Power Ltd., Reliance Enterprises will concentrate on enhancing sustainable energy solutions across the country.

The new company will implement smart distribution and metering systems, ensuring efficient energy management and accessibility throughout Bhutan.