A World Bank economist has said that the lender will fund only those hydro-power projects where safeguards are in place to prevent any adverse impact on the environment.
"We are prepared to support only those good hydro-power projects in India which make economic sense as well as take socio-environment safeguards very seriously," Michael Toman, lead economist on climate change in World Bank told PTI in Kolkata during a visit to the city.
"The impact in terms of environment, relocation of people, availability of water to farmers should be minimum. We want all these environment and social factors to be taken care of," he said when asked to comment on protests against power projects in states like Uttarakhand and Arunachal Pradesh. World Bank lends money to a number of development projects in India, including power projects.
Speaking on the sidelines of a seminar on energy security organised by research body CUTS International, he said large grid-connected power projects have the advantage of being cheaper through the economies of scale.
"You also have the benefit of large storage capacity so that electricity is made available throughout the year," Toman, who is also the manager of the Energy and Environment Team of World Bank, said.
Various environmental groups in India have raised concerns over safety of large power projects. Last year's catastrophic flood in Uttarakhand was also blamed on hydro-projects for intensifying the magnitude.
Hydropower projects are generally made to generate electricity by making dams and reservoirs to provide hydraulic head and release water through turbines on a schedule that matches energy demands.
It is estimated that there are 79 million households in India that have no access to electricity and the country imports 28% of its net energy consumption. Toman said off-grid clean energy projects at a home scale level are important to improve energy access.
Praising the government's Jawaharlal Nehru National Solar Mission which aims to create 10,000 MW of clean energy by grid-connected solar power plants during the 12th plan, he said the country going is in the right direction.
"India is making a lot of progress steadily to generate electricity," Toman said.