ISLAMABAD: The World Bank on Monday approved $1 billion in additional financing for the 4,500-megawatt Dasu Hydropower Project, taking its total financing to $1.7bn for the $2.5bn project.

“The World Bank’s Board of Executive Directors approved on Monday $1 billion in a second round of additional financing for the Dasu Hydropower Stage I (DHP I) Project,” the Washington-based multilateral agency announced in a statement.

This financing will support the expansion of hydropower electricity supply, improve access to socio-economic services for local communities and build the Water and Power Development Authority’s (Wapda) capacity to prepare future hydropower projects, it said.

“Pakistan’s energy sector suffers from multiple challenges to achieving affordable, reliable, and sustainable energy,” said Najy Benhassine, World Bank’s country director for Pakistan.

Financing expected to help Pakistan save $1.8bn annually by replacing imported fuels, offset 5m tonnes of CO2

“The Dasu Hydropower Project’s site is one of the best hydropower sites in the world and is a game changer for Pakistan’s energy sector. With a very small footprint, the DHP will contribute to ‘greening’ the energy sector and lowering the cost of electricity,” he added.

Located on the Indus River about eight kilometres from Dasu town in the Upper Kohistan district of Khyber Pakhtunkhwa province, the Dasu Hydropower Project is a run-of-river project that, upon completion, will have an installed capacity of 4,320–5,400 MW.

The project is being developed in stages, each with a generation capacity of 2,160 MW. DHP-I is expected to generate 12,225 gigawatt-hours (GWh) per year of low-cost renewable energy. The subsequent stage, DHP-II, will add between 9,260 and 11,400 GWh per year from the same dam.

“DHP-I is an essential project in Pakistan’s efforts to reverse its dependence on fossil fuels and reach 60 per cent renewable energy by 2031,” said Rikard Liden, the task team leader for the project.

“The second additional financing will facilitate the expansion of electricity supply and potentially save Pakistan an estimated $1.8bn annually by replacing imported fuels and offset around five million tonnes of carbon dioxide. The annual economic return of DHP-I is estimated to be around 28pc,” he said.

The additional financing will further support ongoing socio-economic initiatives in Upper Kohistan, particularly in the areas of education, health, employment and transport. Through this project, adult literacy has increased by an estimated 30pc since 2012, boys’ schooling increased by 16pc while girls’ schooling has increased by 70pc during this period, the World Bank claimed.

The project will also continue ongoing community development activities on roads, irrigation schemes, schools, medical facilities, mosques, bridges, solar energy systems, and science laboratories and libraries, all with a particular focus on women beneficiaries, including the establishment of free healthcare clinics and camps with women doctors/nurses, training for female health workers, training on livelihoods and literacy for women, and awareness-raising programmes on health and hygiene.

In April 2020, the World Bank approved $700 million in financing for a 250km transmission line project that is currently under implementation. The overall Dasu project is estimated to cost about Rs510bn.

Published in Dawn, June 12th, 2024