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May 27, 2020

U.S. Partners With Pakistan on Clean Energy Initiative For Adding 3,000 MW to Grid

Islamabad – The U.S. government will work with Pakistan to advance reforms that will allow the U.S., Pakistani and international private sector developers and investors to add at least 3,000 megawatts of clean power to Pakistan’s national grid within the next 3-5 years.

The new initiative to facilitate and accelerate private investment in clean energy project was announced during the second U.S.-Pakistan Energy Working Group meeting held in Islamabad on April 29, says an announcement posted on the official website of the U.S. Embassy in Pakistan.

“This clean energy initiative will help address Pakistan’s energy challenges,” said U.S. State Department’s Special Envoy for Energy Amos Hochstein who led a high-level delegation at the talks held under the broader U.S.-Pakistan Strategic Dialogue Framework. “It is a partnership to help alleviate Pakistan’s energy challenges.”

Pakistan’s energy demand is expected to double by 2020. Power shortages peaked to nearly 6,000 megawatts in summer last year, shutting factories and forcing the government to resort to load-shedding through power cuts for as long as 18 hours a day.

Addressing this challenge will require significant action by Pakistan to institute reforms that create space for private sector support, as well as the support of many countries and institutions.

The new effort marks a new phase of U.S. energy sector assistance to Pakistan which, since 2010, has contributed over 1,500 megawatts of electricity to Pakistan’s national grid by refurbishing existing hydro-power and thermal generation facilities, completing hydro-power projects, and improving the operation and efficiency of Pakistan’s transmission and distribution systems.

Special Envoy Hochstein, Deputy Chief of Mission Williams and a high level delegation from Washington met with Minister Shahid Khaqan Abbasi, Minister Khawaja Asif, and a range of Pakistani government officials to discuss measures to increase cooperation in the clean energy sector.

The two sides discussed steps to strengthen regulatory institutions and develop market-based rules to attract private investment; develop an investment strategy for expanding the role of clean energy systems; expand transmission capacity for clean energy projects; and mobilize loans, grants, technical assistance and guarantees needed to manage and reduce private sector risks and leverage private capital into clean power projects.

Clean power investments in hydroelectric, wind, solar, biomass, and natural gas, combined with an expanded effort to improve the efficiency at all parts of the energy sector, will reduce Pakistan’s dependence on foreign fuel sources, help address climate change, improve Pakistan’s energy security, and promote innovation and growth.

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