The Afghanistan government has signed an agreement with two EPCs, local firm Zularistan Energy for Afghanistan (ZEFA) and Turkey's 77, to set up a 15MW solar PV project each in Kandahar, in the south of the country.

Naqibullah Hasanzai, procurement manager at ZEFA, told PV Tech that the capacity was awarded by the government and ZEFA is currently working on another 10MW solar project with Dynasty Indian Company as a local partner, which was awarded by USAID. It is also working on a 260kW project for UNICEF in the UN Kabul Compound. ZEFA recently completed another 400kW project for Agha Khan Foundation in Bamain province for Agha Khan Hospital.

The latest agreements for 77 and ZEFA's 15MW projects were signed in the presence of president Ashraf Ghani. The public-private partnership projects will cost US$47.3 million and as part of the agreement, US$14 million will be provided by the government.

The national utility Da Afghanistan Breshna Sherkat (DABS) has signed a 20-year power purchase agreement (PPA) with the construction firms and the project will take one year to complete.

ZEFA has also submitted proposals for Nanghahar province (40MW), Farah (12MW), and Khost (10MW).

Wahdat Qahar, general manager at ZEFA, also said: "Though the government has taken some positive steps to develop this sector through DABS (power regulatory authority), Public Private Partnership (PPP) program for which a Directorate is established in Ministry of Finance and Ministry of Energy and Water, we still have challenges to overcome. I could name a few like lack of insurance policy of government for international companies/investors, lack of investment opportunities due to fragile and critical conditions, banking system is not investor friendly. Thus we always need to find a partner from abroad and convince them for investment in Afghanistan’s renewable energy sector which indeed is a challenging job under the circumstances."

The Asian Development Bank (ADB) last year approved a US$44.76 million grant to support the development of a 20MW solar PV project in Kabul’s Surobi district, while Indian contractor Dynasty Oil & Gas started work on a 10MW solar PV project also at Kandahar, for which Zularistan is the sub-contractor.