Pakistan’s solar energy market is expected to record a CAGR (compound annual growth rate) of 2.5 per cent from 2022 to 2027 and the proposed plan of eliminating customs duty on solar panel price and its related tools in the budget for FY2023-24 is a favourable attempt.
This initiative by the federal government to promote power generation using alternative energy aims to support domestic solar panel producers and promote solar energy consumption throughout the nation.
In Pakistan solar energy has an optimistic impact for the residential areas, and the corporations. The dwellers of various residential societies through accessing the solar panels; enjoy cost savings in their electricity’s utility bills. The residents in our country, are capable to power their electronic appliances utilizing the solar panels, which reduces the shortfall of electricity. Though the installation cost is high, and any roof damage from installation of solar panels can lead to leakages; the advantages of cost-savings and generation of clean energy to power the homes are enormous. The domestic residents are able to access the solar energy through the installation of the photovoltaic panels on their rooftops. The solar power cells utilized on the photovoltaic panels consist of the optimistic or the pessimistic field.
| Commercial Energy Supplies In Pakistan | ||||||||
|---|---|---|---|---|---|---|---|---|
| FiscalYear | Oil | Gas | Petroleum Products | Coal | ||||
| Crude Oil Imports 000 barrels |
Local Crude Extraction 000 barrels |
Production mcf* |
Imports mcf |
Imports 000 tons |
Production 000 tons |
Imports 000 tons |
Production000 tons | |
| 2017-18 | 79,607 | 32,557 | 1,458,936 | 320,180 | 13,344 | 12,929 | 13,684 | 4,297 |
| 2018-19 | 66,833 | 32,496 | 1,436,455 | 380,879 | 8,807 | 11,839 | 15,686 | 5,841 |
| 2019-20 | 50,022 | 28,087 | 1,316,635 | 355,559 | 7,539 | 9,353 | 16,422 | 8,735 |
| 2020-21 | 65,494 | 27,568 | 1,279,243 | 423,951 | 10,117 | 10,070 | 18,850 | 9,230 |
| 2021-22 | 84,441 | 26,804 | 1,237,251 | 405,925 | 13,186 | 10,992 | 32,533 | 9,595 |
| (July-March) | ||||||||
| 2021-22 | 49,705 | 20,407 | 925,107 | 301,809 | 9,346 | 8,181 | 12,209 | 4,847 |
| 2022-23 | 43,916 | 19,275 | 899,059 | 250,086 | 6,118 | 7,383 | 6,577 | 8,842 |
Experts recorded that the industrial sector of Pakistan can rely on the usage of the solar panels for generating heat for various industrial purposes like production, and processing of chemicals, minerals and foods, oil recovery and processing of minerals. Owing to the challenge of shortfall of electricity mainly during the summers, the solar panels can aid in enhancing the energy access for the industries. Furthermore, the solar energy is helpful in dissimilar industrial operations whereby the solar energy heats oil. The oil is used to produce steam, and the steam operates the machinery, mechanical cycles and the turbines for production of electricity.
Support of China
Solar energy equipment is usually imported from China, which is costly. According to the Pakistan-China Joint Chamber of Commerce and Industry (PCJCCI), Chinese companies are main financiers in Pakistan’s renewable energy projects as out of foreign investment of $144 million in solar PV plants, $125 million is coming from China, constituting nearly 87 per cent of total capital. Of the cumulative production capacity of 530MW, statistics identified that 400MW(75%) was being generated by the Quaid-e-Azam Solar Park, the first-ever power project capable of generating solar energy in our country, owned through the Punjab government and built by a renowned Chinese company.
Chinese companies are also major suppliers to many solar PV projects such as mini-solar grids in Khyber-Pakhtunkhwa and the ADB’s Access to Clean Energy Programme. According to government officials, the promotion and development of indigenous renewable energy resources are on the least cost principle and in the realization of the need to decline the impact of prevailing high prices of imported fossil fuels in international markets resulting in high electricity tariffs and drain of precious foreign exchange.
The federal cabinet in its meeting held in October 2022, accepted the Framework Guidelines for Fast Track Solar Initiatives 2022. Under the initiative, Solar PV-based power generation capacity shall be solicited to substitute expensive imported fossil fuels used for power generation that will lower the average basket cost of generation for the system. The government officials also recorded that the government planning to add about 6,000MW of solar PV capacity under this initiative. Moreover, decentralised, medium-scale Solar PV power can contribute cost-efficiency to alleviate some of these problems through feeding directly into the medium-voltage (MV) network, thereby enhancing the local losses, power outages, and voltage condition.
Furthermore, the injection of Solar PV power into the MV network would provide cheap electricity to the national grid without any augmentation or significant upgrade of the grid infrastructure. Accordingly, solar PV projects of suitable capacity up to a maximum of 4MW will be procured by competitive bidding at an 11 kV feeder level.
The standard RFP and EPA are already prepared for developing small solar projects of up to 4MW capacity at feeder level in Pakistan. In these initiatives, the solarisation of public buildings will help meet a specific portion of the electricity load by clean energy technology, reduce electricity bills of public offices, and relieve electricity utilities/distribution companies from long-term dues.
Under this initiative, building-specific solar PV net-metering-based systems will be installed through bidding on lease (10-year BOOT basis) and the own-cost models.
Pakistan’s Alternative Energy Development Board (AEDB) has been tasked to carry out the solarisation of public buildings through competitive bidding on behalf of public sector entities. No doubt, solar energy in Pakistan is deemed to be an alternative source of energy for economic prosperity.