Pakistan to develop two large-scale solar power projects in Jhang, Muzaffargarh with help of Saudi energy company

The federal government has included two large-scale solar power projects, totalling 2,800 MW, in the Indicative Generation Capacity Expansion Plan (IGCEP) 2025-35. These projects may be offered to Saudi energy company ACWA Power under a potential Government-to-Government (G2G) agreement, Business Recorder reported, citing sources.  

The National Grid Company of Pakistan Limited (NGC) has notified the Private Power and Infrastructure Board (PPIB) about the inclusion of two projects with capacities of 1,000 MW and 1,800 MW, which are set to be developed by ACWA Power in Layyah, Jhang, and Muzaffargarh.

The finalisation of these proposals depends on approval from the National Electric Power Regulatory Authority (NEPRA). 

The projects had faced uncertainty earlier. In November 2023, ACWA Power declined to sign an agreement with Pakistan, citing security concerns. 

However, following a visit by a delegation of Saudi investors, including ACWA representatives, discussions with the Special Investment Facilitation Council (SIFC) revived interest. Pakistan’s embassy in Riyadh has continued to engage with the company since then.

Despite renewed interest, challenges remain. Saudi authorities have raised concerns about the treatment of M/s Al-Jomaih, a Saudi investor involved with K-Electric, which has made Saudi investors cautious about entering new ventures in Pakistan. The matter is being handled by Deputy Prime Minister Senator Ishaq Dar.

The inclusion of these solar projects in the IGCEP highlights the government’s commitment to diversifying its energy mix and attracting foreign investment in renewable energy, although political and regulatory assurances remain essential to securing such high-value deals.