Pakistan receives $100M loan for renewable energy
The European Investment Bank has granted a EUR 100 million long-term loan to the government of Pakistan for the construction of the Keyal Khwar Hydropower project.
The Water and Power Development Authority (WAPDA), which will construct the plant, has considerable experience with similar hydropower pants. It is estimated that the construction period will be four years starting from January 2013.
The project consists of a 128 MW run-of-river hydropower plant with a small 1.5 ha reservoir for daily regulation. The aim of the scheme is to provide a clean and reliable supply of energy, thus avoiding significant volumes of CO2 emissions. The project will feed the renewable energy into Pakistan’s national power grid, generating significant economic benefits.
The project is also receiving financial support from KfW and has been structured under the mutual reliance initiative. This collaborative approach will make it possible to exploit synergies between the two financial institutions.
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A Declaratory Statement was signed by EIB Vice-President Magdalena Álvarez Arza and Nargis Sethi, secretary of Pakistan’s Economic Affairs Division, at a ceremony in Islamabad on Feb. 17.
Secretary Sethi in her remarks appreciated EIB’s financial assistance for the energy sector project, which will not only help in tackling the energy crisis but will prove to be a source of clean renewable energy. She also invited EIB for participation in financing of energy efficient projects in future as well.
“The European Investment Bank is committed to supporting investment in renewable energy and helping countries around the world reduce carbon emissions,” Álvarez said. “At the same time the EIB is pleased to be able to support Pakistan in this important sector, addressing the increased demand of energy in the country.”
"Coming shortly after the granting of GSP+ trade preferences, the visit by the EIB, which is the Investment bank of the EU, shows how the EU is committed to expand its investments in Pakistan, especially in the energy sector,” said Ambassador of the European Union to Pakistan Lars-Gunnar Wigemark.
The EIB is providing this loan under the current lending mandate for Asia and Latin America (2007-2013). The project will contribute to climate change mitigation and environmental sustainability in Pakistan, which are key priorities of the European Union and also key operational priorities of the EIB.
This is the fifth project supported by the EIB in Pakistan. Since it began lending in Asia in 1993, the EIB has provided more than EUR 5.1 billion for long-term investment projects, including EUR 2.4 billion in the energy sector.
Trafigura and Yara International explore clean ammonia usage
Reducing shipping emissions is a vital component of the fight against global climate change, yet Greenhouse Gas emissions from the global maritime sector are increasing - and at odds with the IMO's strategy to cut absolute emissions by at least 50% by 2050.
How more than 70,000 ships can decrease their reliance on carbon-based sources is one of transport's most pressing decarbonisation challenges.
Yara and Trafigura intend to collaborate on initiatives that will establish themselves in the clean ammonia value chain. Under the MoU announced today, Trafigura and Yara intend to work together in the following areas:
- The supply of clean ammonia by Yara to Trafigura Group companies
- Exploration of joint R&D initiatives for clean ammonia application as a marine fuel
- Development of new clean ammonia assets including marine fuel infrastructure and market opportunities
Magnus Krogh Ankarstrand, President of Yara Clean Ammonia, said the agreement is a good example of cross-industry collaboration to develop and promote zero-emission fuel in the form of clean ammonia for the shipping industry. "Building clean ammonia value chains is critical to facilitate the transition to zero emission fuels by enabling the hydrogen economy – not least within trade and distribution where both Yara and Trafigura have leading capabilities. Demand and supply of clean ammonia need to be developed in tandem," he said.
There is a growing consensus that hydrogen-based fuels will ultimately be the shipping fuels of the future, but clear and comprehensive regulation is essential, according to Jose Maria Larocca, Executive Director and Co-Head of Oil Trading for Trafigura.
Ammonia has a number of properties that require "further investigation," according to Wartsila. "It ignites and burns poorly compared to other fuels and is toxic and corrosive, making safe handling and storage important. Burning ammonia could also lead to higher NOx emissions unless controlled either by aftertreatment or by optimising the combustion process," it notes.
Trafigura has co-sponsored the R&D of MAN Energy Solutions’ ammonia-fuelled engine for maritime vessels, has performed in-depth studies of transport fuels with reduced greenhouse gas emissions, and has published a white paper on the need for a global carbon levy for shipping fuels to be introduced by International Maritime Organization.
Oslo-based Yara produces roughly 8.5 million tonnes of ammonia annually and employs a fleet of 11 ammonia carriers, including 5 fully owned ships, and owns 18 marine ammonia terminals with 580 kt of storage capacity – enabling it to produce and deliver ammonia across the globe.
It recently established a new clean ammonia unit to capture growth opportunities in emission-free fuel for shipping and power, carbon-free fertilizer and ammonia for industrial applications.