The IFC, which is part of the World Bank Group, says the Karot run-of-river project is one of the largest private sector renewable energy projects in the country and is needed to help address severe power shortages and spur growth.
IFC’s support for the $1.7bn project on the Jhelum River marks the IFC’s first project finance engagement with China Three Gorges Corporation (CTGC), one of the world’s largest renewable power companies.
In 2015, IFC acquired a 15 per cent stake in China Three Gorges South Asia Investment Limited, CTGC’s renewable energy platform company in Pakistan, to help develop a series of renewable energy projects in the country.
Pakistan has been suffering from a severe power deficit resulting in load shedding of over six hours per day on average, hampering the country’s economic growth and development. The Karot plant, which should be operational in five years, is expected to generate 2970 GW/h of net energy annually.
“Improving access to electricity in Pakistan is a priority for IFC and the World Bank Group, and we are pleased to see the Karot project advance,” said Bernard Sheahan, IFC Global Director for Infrastructure and Natural Resources.
“Our priority has been to support the sponsor and the company in the project’s development by strengthening their environmental, social, and corporate governance capabilities, to ensure power is delivered sustainably.”