The International Finance Corporation has mobilised a combined $238 million in financing to help build Pakistan’s largest wind power facility, delivering new installations with a capacity of 150MW.
The IFC is providing $66 million to the project, while the Asian Development Bank and the Islamic Development Bank are each contributing $75 million. The balance is being provided by Germany’s DEG. This is the first time a portfolio of three separate plants is internationally financed by a single consortium in Pakistan.
The facilities will be developed by Karachi-based Tricon Boston Consulting Corporation, which will build three adjacent 50MW wind farms in Sindh province when it receives the financing. The project company is majority-owned by the Sapphire Group, a Pakistani industrial group with interests in textile and power. Sapphire Group commissioned its first 52.8MW wind farm in 2015.
The new facility is set to be fully commissioned by the end of 2018. It will be connected to the national grid and sell all its output to the state-owned Central Power Purchasing Agency Guarantee, under a 20-year agreement.
This is the IFC’s fifth investment in Pakistan’s wind power in the last three years, according to Mouayed Makhlouf, the institution’s director for the Middle East and North Africa. The project is expected to help diversify energy sources, cut electricity cost and reduce the use of polluting and expensive fossil fuels. Pakistan suffers from frequent power cuts which cost an estimated 2 percent of GDP every year.
The project is also part of the World Bank’s Pakistan Transformational Energy Initiative and Joint Implementation Plan, which aims to mobilise $10 billion of investments for new power generation to improve sector sustainability and address the country’s acute power shortages.
Last October, emerging market-focused investment firm InfraCo Asia developed and commissioned two 50MW wind power plants in the Sindh province, with debt and equity support from the IFC.