World Bank invites authorities to negotiate agreement on solar project

Article Republished By Javier Troconis

In a bid to promote climate-friendly energy generation, the World Bank (WB) on Saturday invited Water and Power Development Authority (WAPDA) and the Ministry of Economic Affairs to deliberate on the terms and conditions of the $345.1 million loan which it is expected to release to facilitate the development of the 300 MW floating solar project at Tarbela – Ghazi Barotha complex. The project’s projected cost is proposed to be around $346.5 million. As per the proposed agreement, approximately half ($170.5 million) of the loan would be covered by International Bank for Reconstruction and Development (IBRD), whereas the rest – $171 million – would be credited by the International Development Association (IDA). However, allocations are subject to final modalities between the Ministry of Economic Affairs, WAPDA, and the World Bank. According to sources privy to the matter, Water and Power Development Authority would finance the remaining $5 million required to meet the project’s proposed cost.

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The invitation was extended by the World Bank’s acting director of the country, Gailius Draugelis, on behalf of the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA) to the Secretary Mian Asad Hayat-ud-Din of the Economic Affairs to deliberate and negotiate on the proposed IBRD loan and IDA credit for the Floating Solar in Pakistan Project.

According to sources privy to the matter, the meeting would discuss (i) Draft Project Appraisal Document (PAD); (ii) Draft IBRD Loan Agreement; (iii) Draft IDA Financing Agreement; (iv) Draft Project Agreement; (v) Draft Disbursement and Financial Information Letters (DFILS), Interim Financial Reports (IFR) and Environment templates; (vi) Social Commitment Plan (ESCP); and (vii) Procurement Plan.

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Floating Solar Project:

Under the project, a 150 MW floating solar subproject will be deployed in the Ghazi Barrage headpond and another floating project of similar capacity at the Forebay of the existing Ghazi Barotha Hydropower plant. The project would greatly enhance the electricity supply and help meet the rising demand for electricity in a climate-smart manner.
Currently, according to the National Electric Power Regulator Authority state industry report 2021, Pakistan’s total installed electricity generation capacity is 143,588 GWH, of which a measly 4,521 GWH is produced by renewable sources such as solar and wind. Thermal sources account for 61.76 percent, whereas Hydel sources account for 27.02 percent. A shift toward renewable energy sources was long pending and is a major component of Pakistan’s vision 2050.

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