ISLAMABAD: The experts from energy, finance, banking sector and capital market on Wednesday discussed different options to promote renewable energy in the country and ways to remove bottlenecks in financing and regulatory approvals.
Expressing their views on launching of a study “de-risking Pakistan’s renewable energy future,” hosted by Renewables First, experts proposed actionable solutions to revitalise the industry and reduce the cost of capital.
The study emphasises innovative financial mechanisms, including securitisation, blended finance, and currency hedging, as essential tools to overcome financing challenges. The study outlines pathways to attract institutional investments and foster a robust renewable energy ecosystem by proposing regulatory reforms such as fiscal incentives and favourable monetary policies.
“The technology is there, but financing remains the bottleneck,” said Zeeshan Ashfaq, CEO of Renewables First in his opening remarks.
The study outlines solutions to lower the cost of capital, including securitisation, blended finance, and fintech-driven models.
Ahtasam Ahmad, author of the study, emphasised the potential global impact, “a 1% reduction in the cost of capital for emerging markets could save $150 billion in clean energy financing under the net-zero scenario.”
The panel highlighted innovative risk management tools, capacity building, and transparent impact storytelling to attract concessional capital. Policy interventions, such as rationalised taxes and structured incentives, alongside public-private collaboration, are essential to enhance investor confidence, mobilize resources, and scale renewable energy projects effectively.
The panelists argued that securitisation can transform renewable energy financing by standardising projects, pooling smaller assets, and leveraging global insights to attract institutional investors. Developing credit enhancements, secondary markets, and regulatory clarity is essential. Collaboration among stakeholders will unlock capital for new projects, enabling Pakistan’s energy transition and reducing reliance on traditional financing models.
Talha Ameer Khan, CFA, Deputy CEO, Burj Clean Energy Modaraba, shared insights on Pakistan’s first clean energy fund. “By consolidating fragmented investments into a cohesive platform, we’re not only mobilising capital but also creating a scalable model for clean energy on the Pakistan Stock Exchange,” he said.
Irteza Ubaid, COO, of Shams Power Limited, emphasised benefits for developers, saying that “securitization unlocks capital tied in existing projects, allowing reinvestment into new ventures, thereby accelerating the energy transition.”
Arif Lakhani, Co-Founder, of Qist Bazaar, explained his lease-to-own model: “our approach allows households to pay instalments equivalent to their electricity bills, democratising access to renewable energy while enabling ownership.”
Vardah Malik, Climate Finance Advisor, Chemonics International, emphasised fintech’s transformative potential, “Fintech can bridge the renewable energy financing gap by reducing transaction costs and introducing peer-to-peer lending models.”
Nayab Babar, CFA, Head of Strategy, JazzCash, spoke about data-driven solutions: “Leveraging data analytics and credit scoring, fintech can address credit gaps and tailor renewable energy financing to underserved communities.”
Umair Sheikh, Managing Director, Innovate47, advocated energy trading platforms: “innovative models enabling solar energy trading can generate new revenue streams and simplify transactions through digital payments.”
Copyright Business Recorder, 2024
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