Karachi: The State Bank of Pakistan (SBP) has enhanced the scope of its Refinance Scheme for Renewable Energy by allowing financing under category III of the scheme to solar and wind based energy sale companies. In light of the feedback received from stakeholders, the size of the project established by vendor/ supplier/ energy sale company has been enhanced from 1 MW to 5 MW, said a news release on Wednesday.
Accordingly, the cumulative financing limit has also been increased from Rs.1 billion to Rs.2 billion. Details are provided in the circular at: http://www.sbp.org.pk/smefd/circulars/2020/CL23.htm
The SBP Renewable Energy Financing Program was announced in June 2016 and aims to help solve the country’s energy shortage and climate change challenges. The plan is divided into two categories: the first category provides financing for the establishment of renewable energy power generation projects, with a capacity of 1 MW to 50 MW, for self-use or sale to the national grid or a combination of both.
The second category allows financing to household, agricultural, commercial and industrial borrowers to install renewable energy projects/solutions of up to 1 MW, for own use or to sell electricity to grid/distribution companies through net metering. Later, in July 2019, SBP introduced a new category III to facilitate financing of suppliers/suppliers who install wind and solar systems/solutions up to 1 MW. SBP also launched the Shariah complaint version of the plan in August 2019.
Since the introduction of the plan, the total outstanding funds of the plan has reached 15.56 billion rupees, involving 217 projects, and is expected to increase energy supply by 292 megawatts. The revision of the plan is not only expected to attract new local and foreign investment in the sector, but also to promote the country’s clean energy production, thereby helping to combat climate change.