USA to facilitate private investment in energy projects of Pakistan
30 April, 2015
ISLAMABAD: The United States and Pakistan on Wednesday announced to facilitate and accelerate private investment in clean energy projects in Pakistan.
Under this initiative, the US government will work with Pakistan to advance reforms that will allow the US, 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.
“This clean energy initiative will help address Pakistan’s energy challenges,” said US State Department’s Special Envoy for Energy Amos Hochstein during the second US-Pakistan Energy Working Group under the broader US-Pakistan Strategic Dialogue framework. “It is a partnership to help alleviate Pakistan’s energy challenges based on a set of goals shared by Pakistan, the United States, multilateral banks, donors, and the private sector.”
Special Envoy Hochstein, Deputy Chief of Mission Williams and a delegation from Washington met Shahid Khaqan Abbasi, Khawaja Asif and a range of Pakistani government officials to discuss measures to increase cooperation in the clean energy sector. Energy demand in Pakistan is expected to double by 2020. Addressing this challenge will require significant action by the government to institute reforms that create space for private sector support, as well as the support of many countries and institutions.
To advance the goals of this common initiative, the US and Pakistani officials 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 mobilise loans, grants, technical assistance and guarantees needed to manage and reduce private sector risks and leverage private capital into clean power projects.
Helping the energy sector become more market-based is one of the best alternatives to ending the current crisis and ensuring that future demand can be met. 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.
This initiative marks a new phase of US energy sector assistance to Pakistan, which since 2010 has contributed over 1,500 megawatts of electricity to Pakistan’s national grid by refurbishing existing hydropower and thermal generation facilities, completing hydropower projects, and improving the operation and efficiency of Pakistan’s transmission and distribution systems.
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