France Commits €120 Million to Pakistan’s Keyal Khwar Hydropower Project for Climate-Friendly Energy Development

has committed to investing €120 million (approximately $129.5 million) in the 128 MW Keyal Khwar hydropower project in through a Credit Facility Agreement. The agreement was signed by Dr. Kazim Naiz, Secretary of Economic Affairs Division; H.E. Nicolas Galey, Ambassador of France; and Philippe Steinmetz, country director of the French Development Agency (AFD).

This financial support will assist the Water and Power Development Authority (WAPDA) in its efforts to develop the hydroelectricity sector in Pakistan, according to an official statement. The will also aid in enhancing the competitiveness of renewable power generation, ultimately improving affordability and increasing energy supply, while also minimizing the impact of power generation on the environment and climate.

The AFD funding will be used to mitigate flood-affected areas in Kyber Pakhtunkhwa and rehabilitate during the construction of the hydropower project. Additionally, study grants will be provided to define environmental and social management measures in line with international standards. The project is also expected to replace thermal power plants, reducing the equivalent of 182,000 tons of CO2 emissions per year once it is commissioned in 2028. Additionally, the project is expected to improve the quality of life for 600,000 inhabitants.

The Keyal Khwar hydropower project is located on a tributary of the Indus River near the city of Pattan. The plant will produce 420 GWh/year, with 25% of that being peak load. The project will include a 57-m-tall, 114-m-long concrete gravity dam, underground powerhouse, and a 7-km-long concrete-lined headrace tunnel, among other features.

The Keyal Khwar hydropower project aligns with the French Government's agenda of promoting climate-friendly projects and reducing greenhouse gas emissions, as well as with the French pledge and commitments announced at the International Conference on Climate Resilient Pakistan on January 9, 2023.

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