Pakistan and the Asian Development Bank (ADB) signed an agreement October 5 for a US$510 million renewable energy loan whose initial recipient will be a series of small hydropower project �clusters� to be built in North West Frontier Province (NWFP) and Punjab Province.
The multi-tranche loan program is the first of its kind in Pakistan and one of the first to be developed under ADB’s clean energy and efficiency initiative. The program is to develop indigenous, non-polluting, renewable sources of energy to help meet Pakistan’s power shortage and to diversify power sources.
The government of Pakistan has been in the process of recruiting consultants, contractors, and equipment suppliers for the NWFP and Punjab hydro project clusters since 2006. (HNN 8/14/07) The two province governments are expected to borrow up to US$180 million and US$150 million respectively to fund their projects.
Other provinces can request funding for renewable energy projects totaling US$170 million. The loan will have a life of ten years to 2017, ADB said.
�Small to medium-sized hydropower plants offer the greatest renewable energy potential for Pakistan, while possibilities also exist in promoting greater use of wind, solar, and biomass power,� ADB Pakistan Country Director Peter Fedon said.