CDC Group, the UK’s publicly owned impact investor, has signed an $82 million debt deal in a wind power project in Pakistan that will reduce the country’s dependence on fossil fuels.
The deal will fund 150MW of wind farms located in the Jhimpir area of the Sindh province of Pakistan. The project involves three separate schemes of 50MW each – two developed by Liberty Mills and one by Indus Group.
The projects are part of a program of 12 wind projects across Pakistan totaling 610 MW, increasing the renewable energy generation capacity of Pakistan by 50 percent and providing clean, affordable power to the country at an average tariff of $4.5c/kWh, in comparison to the existing average wind project tariff of $11.0c/kWh.
The projects will avoid the equivalent to the average annual emissions of 130,000 people or 0.06 percent of the total of Pakistan’s annual domestic greenhouse gas emissions. In addition, they will add $19.1 million to the country’s GDP, support the creation of 6,260 indirect jobs and reduce coal and fossil fuel imports by 0.3 percent (or $32.2 million), helping to relieve pressure on foreign exchange reserves.
The $82 million commitment will contribute to three of the UN’s Sustainable Development Goals: Affordable and Clean Energy (7); Decent Work and Economic Growth (8); and Climate Action (13).
The deal announced today takes CDC’s total commitment to the wind power industry in Pakistan to $144 million. CDC undertook the role of Mandated Lead Arranger for the debt of the projects.
Iain Macaulay, Director, Head of Project Finance, at CDC, said:
I am delighted that CDC can play such a pivotal role in the development of renewable energy in Pakistan – bringing 150 MW of reliable and clean energy to Jhimpir region. The latest projects build on the experience and expertise gained from the joint debt and equity investment in the Zephyr wind farm in 2017 and are complemented through the local presence CDC has had in Pakistan for the last 12 months.
Azam Sakrani, Chief Executive Officer, Liberty Wind Power, said:
The wind projects are vital for the economy of Pakistan by generating clean energy at a low price, creating thousands of jobs and supporting the country’s economic growth. This is a new beginning for both the Liberty group and CDC which will open doors for further collaboration.
Indus Chief Executive Officer, Mian Shahzad Ahmed, said:
With CDC’s support, we are now ideally placed to continue to grow Pakistan’s renewable energy industry as we strive to move to a low carbon future.