Reference may be made to SBP’s Financing Scheme for Renewable Energy launched through IH&SMEFD Circular No. 03 of 2016. In order to make this financing facility available through Islamic Banking Institutions (IBIs) and Islamic DFIs, SBP is now introducing a Mudarabah based "Islamic Financing Facility for Renewable Energy (IFRE)" for IBIs and Islamic DFIs; collectively referred to as Participating Islamic Financial Institutions (PIFIs). SBP shall make Mudarabah investment in general pool of PIFIs under IFRE.

2.    The financing under IFRE is available in two categories i.e. (i) Prospective sponsors desirous of setting up renewable energy power projects with capacity ranging between 1-50 MW and (ii) consumers willing to install facility using renewable energy source for generation of electricity ranging between 4 KW - 1 MW for own use and/or for supplying to the distribution company. Mudarabah investment of SBP in IFRE shall be available for up to the amount financed to the eligible projects, subject to a maximum financing limit of Rs. 6 Billion. IFRE shall be effective immediately and financing shall be available for new systems installed / new projects initiated from the date of issuance of this circular and shall remain valid till further instructions.

3.    The IBIs / Islamic DFIs may submit their requests for the status of Participating Islamic Financial Institution (PIFI) keeping in view the criteria given in the facility. They may also apply for allocation / assignment of limit for the current financial year. These requests may be submitted within 30 days from the date of issuance of this circular.

4.Details of facility, its Shariah Structure and documents are provided in the Annexures.


Encl:

Annex-I: Islamic Financing Facility for Renewable Energy

Annex-II: Documents for Islamic Financing Facility for Renewable Energy