Pakistan Signs Deal for 560 MW of new Wind Energy Capacity

Pakistan through its AEDB has signed implementation agreements with 11 wind IPPs for 560 MW of new wind energy capacity to serve the Pakistan grid.

In the efforts to achieve greater energy security, the Government of Pakistan through it’s Alternative Energy Development Board (AEDB) has signed implementation agreements and guarantees direct agreements with 11 wind independent power producers (IPPs) for 560 MW of new wind energy capacity to serve the Pakistan grid.

These projects would provide more than 1.8 billion units of clean energy annually. The projects were agreed with the help of the private sector and development finance institution (DFIs) including the International Finance Corporation (IFC), CDC, FMO, ICD amongst others.

Six out of eleven wind projects are financed by the IFC, which on November 15, 2019, signed agreements to finance the so-called Super Six project portfolio with USD 450 million in debt. Those power plants, with a combined capacity of 310 MW, will be installed in the Jhimpir wind corridor in Sindh province and will be able to generate enough electricity to cover the annual needs of 450,000 homes while offsetting around 650,000 tonnes of CO2 emissions annually, IFC said in a separate statement. It will provide some USD 86 million in funds from its own account and USD 234 million mobilised from other lenders.

The government agency, which is tasked with promoting renewables installation in Pakistan, has signed the agreements for 560 MW wind capacity to help with the country’s objective of having 30 percent renewables nationally by 2030 and cutting its dependence on fossil fuel imports.

In September, the Asian Development Bank (ADB) had decided to shortly approve a loan worth USD 350 million for reforms and financial sustainability programmes that aims to address fiscal, governance, technical and policy deficits in the Pakistan energy sector. These deficits have adversely impacted the sector’s quality and efficiency of services, and the sustainability of energy infrastructure and finances, thereby challenging Pakistan’s fiscal balance and macroeconomic stability.

In March, we had reported that Italian oil and gas major, Eni had commenced work on the construction of two new solar projects in Pakistan and Tunisia. The Pakistan plant will be built in close proximity to the Bhit gas field at which Eni is the operator with a 40% stake, through its subsidiary Eni New Energy Pakistan.