World Bank flags substantial risks to $727 million KP energy project

The World Bank has judged the $727 million Khyber Pakhtunkhwa Hydropower and Renewable Energy Development Project’s progress toward its goals to be below expectations, while keeping its overall risk assessment at substantial. The project, approved in 2020 and due to finish by November 30, 2027, seeks to build provincial capacity and expand renewable power generation. The bank said it had revised the project’s design and funding arrangements to reflect government priorities.

Despite the concerns, the lender rated implementation activity moderately satisfactory, pointing to stronger work on the Gabral-Kalam Hydropower Project. Construction has started, land acquisition has moved forward and equipment procurement has advanced, but delivery timelines and contract oversight remain important, as does continued adherence to environmental and social standards. The World Bank identified financial, institutional, economic and environmental challenges among the substantial risks, while political and governance concerns were rated moderate.