ISLAMABAD, Feb 10: The Asian Development Bank is preparing a $550,000 project to promote greater use of renewable clean indigenous energy sources for power generation in the country.

The technical assistance (TA) grant is from the Japan Special Fund, financed by the government of Japan.

A press release issued here on Thursday said, the TA would provide support for analysis of the renewable energy potential of each province and feasibility studies of selected sample sub-projects for financing under the ensuing loan.

The ADB country director, Marshuk Ali Shah, said Pakistan's renewable energy potential was substantial and the vast majority of it remained unutilized. The TA would prepare a project to meet Pakistan's power shortage and improve the quality and reliability of the power system especially, in rural areas.

The statement said most of the imported oil was used for electricity generation and it could not satisfy the demand. "Pakistan faced 20 per cent shortfall in power availability, while only a little more than half of the population had access to electricity from the national grid."

The remaining 45 per cent used kerosene wood or other bio-fuels for lighting, cooking and heating, it added.

"Pakistan also had one of the lowest per capita consumption of energy in the world. More than 70 per cent of the country's electricity came from thermal sources and less than 30 percent came from hydropower."

The statement said the government was emphasizing utilization of renewable energy by setting a target of 10 per cent renewable energy or 2700MW in the country's energy mix by 2015.

The total cost of the TA was about $800,000 of which $250,000 were being funded by the government, it added.