NEW DELHI - The World Bank will extend a $180-million (Rs.900-crore) loan to India for upgrading its polluting coal-fired power plants and bringing down carbon emission, it said Friday.

“The project, which is expected to lower carbon emissions and boost power production at these plants, is co-financed with a $45.4-million grant from the Global Environment Facility (GEF),” World Bank said in a statement.

GEF is a global partnership among 178 countries, international institutions, non-governmental organisations and the private sector to address environmental issues and support national sustainable development initiatives.

“If scaled up effectively to the remaining similar units needing rehabilitation, India could be looking at emissions cuts anywhere between 10 to 13 million tonnes of carbon dioxide equivalent each year,” said World Bank energy specialist and project team leader Mikul Bhatia.

At present, about 80 percent of the electricity supplied to homes, farms and factories in India come from coal-fired generation plants, one-third of which are old, inefficient, and emit harmful gases into the atmosphere, the bank said.

The first phase of the project will aim at upgrading old and inefficient power plants with a cumulative capacity of 27,000 MW, almost a fifth of India’s installed power capacity of 145,000 MW.

The World Bank noted that Indias power shortage is an obstacle to its development, with over 400 million people not having access to electricity, and 60 percent of industrial units being forced to generate its own power.