The Iranian government has announced some $5 billion in new loans to developers of renewable power plans amid efforts to offset electricity production issues caused by fuel shortages in the country’s thermal power plants.

The Central Bank of Iran (CBI) said in a Tuesday statement that the banking system in the country will offer up to $5 billion worth of loans to builders of renewable power plants in the next four years using finances made available by Iran’s sovereign wealth fund.

The CBI said the Iranian Energy Ministry’s department of renewables (SATBA) will be responsible for vetting applications to set up renewable power plants that seek to use the new funds.

It said companies that receive the loans would be exempt from strict CBI regulations governing large loans, adding that banks would also be able to accept lands and equipment of the proposed power plants as collateral.

The lender said state and private banks in Iran can issue bonds, including SCF or sukuk bonds, to finance the scheme.

The CBI said Iranian state companies that export commodities to other countries can use their export proceeds to import renewable power plant equipment to build electricity stations in their factories.

The announcement came hours after Iranian President Masoud Pezeshkian chaired a meeting of high-profile government officials to streamline processes related to the expansion of Iran’s renewable sector.

Pezeshkian said in the meeting that Iran is committed to increasing its renewables capacity to 30 gigawatts (GW) in the next four years, from a current figure of nearly 2 GW, but said that the country should immediately build a series of solar power plants that could help it cope with next summer’s peak demand.

He also ordered the formation of a consortium of companies controlled by SATBA to buy a large consignment of solar panels.

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