The proposed investment program aims to (i) improve energy security by increasing the clean energy share in the energy mix currently dominated by thermal energy, (ii) promote private sector investments in hydropower development in the province of Khyber Phakhtunkhwa (KPK) which has the most hydro potential in the country, and (iii) build capacity and understanding on climate change impacts, adaptation and mitigation measures. Despite the potential to generate 60,000 megawatts (MW), Pakistan has only been able to install 7,000 MW (31% of total installed capacity) of hydropower generation, of which 3% has been developed by independent power producers (IPPs). Since 1994, IPPs have been investing in Pakistan but skewed to thermal power plants, accounting for 36% of the country's total installed capacity. With support from the Asian Development Bank (ADB) and the International Finance Corporation, IPPs recently made several investments in renewable energy projects.
| Project Name | MFF Hydropower Development Investment Program | ||||
| Project Number | 49055-002 | ||||
| Country | Pakistan |
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| Project Status | Proposed | ||||
| Project Type / Modality of Assistance | Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth |
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| Drivers of Change | Gender Equity and Mainstreaming Governance and capacity development Knowledge solutions Partnerships Private sector development |
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| Sector / Subsector | Energy / Energy sector development and institutional reform |
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| Gender Equity and Mainstreaming | Some gender elements | ||||
| Description | The proposed investment program aims to (i) improve energy security by increasing the clean energy share in the energy mix currently dominated by thermal energy, (ii) promote private sector investments in hydropower development in the province of Khyber Phakhtunkhwa (KPK) which has the most hydro potential in the country, and (iii) build capacity and understanding on climate change impacts, adaptation and mitigation measures. Despite the potential to generate 60,000 megawatts (MW), Pakistan has only been able to install 7,000 MW (31% of total installed capacity) of hydropower generation, of which 3% has been developed by independent power producers (IPPs). Since 1994, IPPs have been investing in Pakistan but skewed to thermal power plants, accounting for 36% of the country's total installed capacity. With support from the Asian Development Bank (ADB) and the International Finance Corporation, IPPs recently made several investments in renewable energy projects. IPP's interest increases if the sector is supported by international financing institutions on the policy, process and investments. The provincial government of KPK plans to develop 21 run-of-the river hydropower plants (HPP) with feasibility study for most of them already completed, with a total potential of 3,600 MW over a period of 10 years with key focus on attracting IPPs. The investment program is structured to facilitate investments in the development of hydropower plants by utilizing both public and private sector investments and leveraging ADB funds through syndication and other financial structures. ADB catalytic financing in the long-term will support and create a business-friendly environment making HPP projects bankable for the private sector to mobilize and invest through debt or equity. | ||||
| Project Rationale and Linkage to Country/Regional Strategy | The program's aims will be achieved by: (i) developing run-of-the-river HPPs with individual plant capacity not exceeding 400 MW in KPK; (ii) promoting private sector investments through by providing access to different ADB credit enhancement products; (iii) mitigate greenhouse gases to meet the Intended Nationally Determined Contributions of Pakistan; and (iv) enhance capacity for climate change risk management in hydropower production. The program will be implemented in four tranches to cover multiple sub-projects in keeping pace with the maturity of the private sector investment. | ||||
| Impact | Reduced carbon footprint and energy sector made more renewable, efficient, and reliable. | ||||
| Outcome | Energy security enhanced. | ||||
| Outputs | Hydropower plants commissioned. Private sector participation in KPK increased. Capacity for climate change risk management in hydropower production enhanced. |
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| Geographical Location | Nation-wide | ||||
| Summary of Environmental and Social Aspects | |
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| Environmental Aspects | |
| Involuntary Resettlement | |
| Indigenous Peoples | |
| Stakeholder Communication, Participation, and Consultation | |
| During Project Design | |
| During Project Implementation | |
| Responsible ADB Officer | Tareen, Adnan |
| Responsible ADB Department | Central and West Asia Department |
| Responsible ADB Division | Energy Division, CWRD |
| Executing Agencies |
Pakhtunkhwa Energy Development Organization Plot # 38, Sect B-2, Phase-5, Hayatabad, Peshawar |
| Timetable | |
|---|---|
| Concept Clearance | 29 Sep 2016 |
| Fact Finding | 05 Jul 2018 to 12 Jul 2018 |
| MRM | 12 Jul 2018 |
| Approval | - |
| Last Review Mission | - |
| Last PDS Update | 04 Oct 2018 |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
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| Title | Document Type | Document Date |
|---|---|---|
| MFFہائیڈرو پاور کے فروغ کے لیے سرمایہ کاری پروگرام | Translated PDS | Apr 2017 |
| Hydropower Development Investment Program: Project Preparatory Technical Assistance Report | Project Preparatory Technical Assistance Reports | Sep 2016 |
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