ISLAMABAD: The green banking initiative of the State Bank of Pakistan (SBP) to finance renewable energy projects will help to reduce the dependence of the country on imported fuel for power generation, WealthPK reports.
Like other countries of the world, dependent on imported fuel for generating electricity, the energy sector of Pakistan has been badly affected by the conflict between Russia and Ukraine. The changing situation across the world has increased the need for the exploration of renewable energy sources.
SBP has been contributing significantly to the exploration of Pakistan’s renewable energy sources. SBP has extended the validity period of its renewable energy financing scheme and Islamic financing facility until June 30, 2024, to facilitate individuals and companies.
According to Pakistan economic survey 2021-22, thermal (oil, diesel, and coal), contributes around 61 percent to power generation in the country while 39 percent of electricity is generated through hydro, solar, wind and nuclear sources. Besides economic benefits, renewable energy sources are also environment-friendly.
SBP has been promoting green banking, which refers to the use of indigenous resources, particularly renewable energy, for the purpose of sustainable development and banking. SBP has launched a scheme to finance both large-scale and small-scale renewable energy projects.
Muhammad Junaid, technical officer at Tesla Industries, told WealthPK that people were moving towards solar energy due to the high price of electricity and excessive load shedding. He said that many industries were generating electricity in a large quantity and selling it to the national grid.
He said that SBP renewable energy scheme would enable individuals and industries to execute their solar projects. However, a lot is needed to be done in this regard so that more people can benefit from this scheme and shift to renewable energy that will help Pakistan to save its foreign reserves and strengthen the national economy.
The oil import bill increased by 96 percent and reached $17.03 billion during the first nine months of the financial year 2021-22 as compared to the same period of the previous year wherein the amount was $8.69 billion. The huge increase in the oil import bill was a result of the hike in the prices of petroleum products in the international market and the depreciation of the Pakistani rupee. It also put pressure on the trade deficit.
For the month of July, the government will find it hard to get the required quantity of liquified natural gas to meet its needs. It is feared that all the sectors will face a severe shortage of electricity and gas. The green banking scheme of SBP can help the government to overcome energy crisis in Pakistan.
