New IFC Guidebook Supports Solar Investments in Pakistan
IFC, a member of the World Bank Group, today launched a guide to help investors develop solar projects in Pakistan, part of ongoing efforts to help address the country’s energy shortfall and boost its capacity for renewables. The guidebook, A Solar Developer’s Guide to Pakistan, provides vital information for international investors and developers implementing solar projects in Pakistan, outlining development procedures and explaining the legal and regulatory mechanisms around them. It also explains the requirements surrounding the preparation, agreement, approval and implementation of projects up to financial close.
Pakistan has been facing a severe energy crisis for the last decade, leading to prolonged load shedding of up to 18 hours daily across the country. About 37 percent of Pakistan’s energy mix is based on expensive fuel. Renewables (excluding large hydro), which can be a cheaper option, contribute less than 1 percent of the current energy mix. While solar potential in Pakistan currently stands at 2.9 million megawatts, only 100 megawatts of grid-tied solar has been commissioned to date. Wind has been thriving since 2012 with at least 477 megawatts reaching financial closure to date, demonstrating a viable market for non-hydro renewables.
‘The solar market in Pakistan is at a nascent stage,’ said Bryanne Tait, IFC Regional Lead for Energy and Resource Efficiency Advisory in the Middle East and North Africa. ‘Pakistan has tremendous potential to meet its power needs from renewable energy sources and, in particular, solar. We hope this guidebook will help provide the information needed to unlock the country’s solar market ’In December 2015, Pakistan’s National Electric Power Regulatory Authority announced a new round of solar tariffs valid until June 30, 2016. The guide is designed to help solar developers make use of these tariffs and drive international investor participation in the country’s solar market.
Pakistan’s Alternative Energy Development Board, National Electric Power Regulatory Authority, Sindh and Punjab Provinces as well as RIAA Barker Gillette, Eversheds, Ernst & Young, AWS Truepower and Nizam Energy all contributed to the guidebook. Developed as part of IFC’s Middle East and North Africa Renewable Energy program, it is supported by IFC development partners the Australian Agency for International Development, Japan and the Netherlands.
