International Finance Corporation, a member of the World Bank Group, is investing $25.8m in a new 50MW wind farm in Pakistan.
It says the wind power project, located in Sindh province, north east of Karachi, will help meet a rising electricity demand in Pakistan and provide an extra 270,000 people with low carbon electricity every year.
IFC’s debt and equity investment of $25.8m will help Metro Power Company implement the project and tackle a growing energy deficit in Pakistan. About a third of the demand for electricity is unmet, which affects living standards and is causing the economy to shrink by 2 percent of GDP per year.
‘We are excited to be helping alleviate Pakistan’s energy deficit by providing sustainable and affordable renewable energy,’ said Danish Iqbal Alimohamed, chief executive officer of Metro Power.
‘Despite challenging market conditions in Pakistan’s power sector, we are pleased with the support we have received from our shareholders, lenders, and the government of Pakistan that enabled us to reach this important milestone.’
The wind farm is expected to generate approximately 140 gigawatt hours of electricity every year, and contribute to a reduction in greenhouse gasses of nearly 100,000 tons of carbon dioxide.
‘Ensuring energy security in Pakistan is vital to improve infrastructure, support the private sector, and create growth,’ said Mouayed Makhlouf, IFC director for the Middle East and North Africa.
‘What’s more, the development of renewable energy is a key feature of IFC’s strategy in Pakistan.’
Metro Power is owned by the Iqbal Alimohamed Family and InfraCo Asia Keenjhar Wind Private Limited. These two sponsors will contribute 22.5 percent of the project cost, building upon their extensive experience in the power sector.
This investment is part of IFC’s wider efforts in Pakistan that focus on mobilizing investments in infrastructure, expanding access to finance to smaller businesses, and boosting job creation. In fiscal year 2013 IFC committed $514m in the country— including mobilization from other investors and lenders.