SAP024

Pakistan’s growing energy sector is heavily reliant on fossil fuels, which currently provide around 65 per cent of the country’s energy mix. Significant investment in renewable energy is needed to curb emissions, meet the country's growing energy demand, and transition its sector to green and reliable energy sources. Pakistan has set targets for emissions reduction and has highlighted the importance of scaling renewable energy sources, including solar power in its national plans. However, significant investment barriers exist, making the switch to renewable energy products such as solar photovoltaic (PV) installations challenging.

The project will provide tailored financing solutions for distributed solar PV products to help bridge the financing gap for these investments in Pakistan. A guarantee facility provided by GCF will be deployed to finance 43 MW solar PV installations for households, agribusinesses and small and medium enterprises (SMEs). It will support lending through the existing renewable energy scheme launched by the State Bank of Pakistan (SBP) in which partner banks offer concessional loans to customers to acquire solar PV systems. With the GCF guarantee facility, JS Bank can broaden the scope of the scheme by reaching previously untapped market segments and users. The project will also provide technical assistance to strengthen capacity of solar PV vendors and other key stakeholders and raise market awareness of climate change risks and the benefits of renewable energy solutions.