The State Bank of Pakistan (SBP) has relaxed conditions for renewable energy solution providers under its Refinance Scheme for Renewable Energy.
According to a statement issued by the central bank on Monday, the move is aimed at promoting investment in renewable energy solutions by companies.
“Now, all renewable energy investment entities (REIEs), interested in installing renewable energy projects/ solutions, are allowed to avail financing under category-III of the scheme,” the SBP said.
It elaborated that a renewable energy investment entity is a business enterprise (including vendors and suppliers) involved in building renewable energy projects for onward leasing/ renting out/ selling on deferred payment basis or selling of electricity generated from these projects to end-users.
The central bank highlighted that it had revised the SBP Finance Scheme for Renewable Energy in July 2019 to help address the challenges of energy shortages and climate change.
“SBP also launched a Shariah-complaint version of the scheme in August 2019,” it said.
The initiative now comprises three categories. Under the first category, financing is extended for setting up renewable energy power projects of one to 50-megawatt capacity for own use or selling electricity to the national grid or a combination of both.
Under the second classification, assistance is allowed to domestic, agriculture, commercial and industrial borrowers for the installation of renewable energy-based projects/ solutions of up to 1MW to generate electricity for own use or selling it to the grid/ distribution company under the net metering mechanism.
Under category-III, financing is granted to vendors/ suppliers/ energy sale companies for the installation of wind and solar systems/ solutions of up to 5MW.