The World Bank has pushed back the deadline for the Sindh Solar Energy Project (SSEP) from September 2023 to July 2025, citing insufficient progress with the project facing a variety of issues, including a two-year delay in picking a full-time Project Management Unit (PMU), COVID-19, the 2022 floods, and the PMU’s limited capacity.
The extension will enable the PMU to extend contracts and avoid further delays for the project that aims to support solar power deployment in Sindh across three market segments: utility-scale, distributed generation, and household level.
Pertinently, the International Development Association had approved $100 million for the project, of which $21.79 million has already been spent.
The World Bank restructured the project after the Economic Affairs Division requested to extend the deadline by 22 months. The Energy Department of the Sindh government has prepared a revised PC-1 that reflects the requested extension and proposes changes to the project design and allocation of funds.
Public funding will be used to leverage private sector investment and expertise. For the most part, the project involves developing solar parks and installing distributed photovoltaics on public sector buildings in Karachi and Hyderabad. The aim is to scale up the provision of solar home systems in areas with limited access to electricity.
The project is designed to enable best practices with renewable energy auctions, reduce the cost of solar deployment, create sustainable business models for replication in other provinces, build institutional and private sector capacity, and identify opportunities for future renewable energy deployment. It will help steer Pakistan towards a lower carbon path to development.
Sindh’s expansion of renewable energy sources has been sluggish, with no solar or wind capacity auctions held thus far. NEPRA provided an upfront tariff equal to a feed-in tariff until 2016, but in 2017 it implemented competitive bidding for awarding tariffs.
