The government of Afghanistan has signed a memorandum of understanding (MoU) with the UAE-based PAL 4 Solar Energy for construction of a solar power plant.

A spokesperson for Da Afghanistan Breshna Sherkat (DABS), an government-owned power company, said PAL 4 Solar Energy will construct a solar power plant with the capacity to generate up to 3GW of clean energy.

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The MoU was signed by PAL 4 Solar Energy managing director Mohammad Zafar, Afghanistan Investment Facilitation Unit head Attaullah Nassib and DABS CEO Ahmad Daud Noorzai at the Afghan embassy in Abu Dhabi.

As per the MoU, PAL 4 Solar Energy will invest in the construction and installation of the solar facility.

DABS spokesperson Wahid Tawhidi said that PAL 4 Solar Energy would begin initial and technical evaluation and then focus on the investment required for the execution of the project, according to Afghanistan Times Daily.

According to Scaling Solar, an initiative by World Bank to promote energy from photovoltaic cells, Afghanistan imports nearly 70% of its electricity from the neighboring countries.

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Last October, the World Bank Group approved a $98.8m financing package. This  comprised of a mix of guarantees, a loan, and swaps, for two gas-to-power energy projects in Afghanistan.

The financing aimed to increase domestically-generated electricity through gas-to-power energy projects, whilst using private financing for the country’s energy sector.

The $98.8m financing package supported the Sheberghan and Mazar-e-Sharif Gas-to-Power Projects.

The package for Mazar-e-Sharif project included a $12m guarantee from IDA to backstop the payment obligation of DABS, and a $23.8m senior loan.