Two major hydropower projects receive funds

By Tahir Ali | Gwadar Pro Apr 10, 2023

ISLAMABAD, Apr. 10 (Gwadar Pro) - While Pakistan’s energy sector is highly dependent on fossil fuel imports and the foreign exchange reserve has always been an issue for the country, two developments this week are highly encouraging in the green and sustainable energy sectors of the country. First, the Saudi Fund for Development (SFD) has signed a US$240 million loan agreement to support Pakistan’s Mohmand Multipurpose Dam Project (MMDP). Second, the Executive Committee of the National Economic Council (ECNEC) of Pakistan has approved the Diamer Basha Power Generation Project (DBPGP) at a cost of over Rs. 1.2 trillion.

Chinese hydropower companies are already engaged in the construction of these two major hydropower projects in Pakistan, helping the country overcome its energy crises with low-cost, green, and sustainable energy. China Gezhouba Group Company (CGGC) in a JV is constructing the Mohmand Dam while Power China in a JV with Frontier Works Organisation (FWO) is constructing the MW-1 Dam part DBPGP.

MMDP will enhance water and food security, and improve the living standard of for the people in Khyber Pakhtunkhwa (KP), where almost 80% of the population resides in rural areas, boosting the region’s socioeconomic development by creating employment opportunities and reducing poverty. By using renewable energy sources, the project will generate 800 MW of electricity production capacity, contributing to Pakistan’s energy security. In addition, the storage of 1.6 million m3 of water will support sustainable agricultural practices, enable irrigation of 6,773 hectares of new land, and increase the total cropping area from 1,517 hectares to 9,227 hectares in the province, facilitating agricultural activities.

Similarly, on April 6, ECNEC approved Rs. 1.24 trillion against the original estimates of Rs. 933.6 billion, owing to currency depreciation for the 4,500 MW Diamer Basha Dam Project. POWERCHINA and FWO are already working on the dam component of the project. DBDP, which is expected to be completed in 2029 will save US$ 2.5 billion every year and will irrigate 1.2 million acres of land.

WAPDA is implementing a multi-pronged strategy for unprecedented hydropower and water storage development in Pakistan under the vision of a “Decade of Dams”. The Government plans to uplift its existing 30% of low-cost hydro electricity to at least 50% in the National Grid.

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