Pakistan has required only 0.071 per cent of its total land for solar installation to end its energy woes as there is also a huge potential for foreign investment in this sector.
Currently, out of the $144 million in foreign investment in PV (photovoltaic) plants in Pakistan, $125 million is from China, accounting for nearly 87 per cent of the total.
Among the 530 megawatts cumulative generation capacity in Pakistan, 400 megawatts (75 per cent) are generated from Quaid-e-Azam Solar Park, the first-ever power plant capable of generating solar energy in Pakistan, owned by the Punjab government and built by China Tebian Electric Apparatus Xinjiang New Energy Co.
With 400,000 photovoltaic panels spreading over 200 hectares of flat desert, the plant was initially launched with a capacity of generating 100 megawatts of power.
Since 2015, there has been the addition of 300 megawatts of power generation capacity with three new projects, and there are numerous planned projects reported for the Quaid-e-Azam Park by AEDB with a cumulative capacity of 1,050 megawatts, according to China Economic Net (CEN).
Chinese companies are also major suppliers to many PV projects in Pakistan such as mini solar grids in Khyber Pakhtunkhwa and ADB Access to Clean Energy Program.
The photovoltaic mini-grid stations in Jandola, Orakzai, and Mohmand tribal districts are in the final stages of their completion and soon the business community will get uninterrupted, cheap, green, and clean energy.
Pakistan’s solar energy market is expected to record a compound annual growth rate of 2.5 per cent from 2022 to 2027.
Up to now, the average utilization rate of the operational photovoltaic plants is merely 19 per cent, far from the over 95 per cent utilisation rate in China, representing huge opportunities to be tapped.
As experienced photovoltaic plants investors in Pakistan, Chinese companies are more likely to further leverage their learning in this sector.
They can also benefit from China’s pledge to move away from coal-based energy generation and promote green energy in developing countries.
Meanwhile, the Pakistani government has set ambitious targets for sun energy capacity under the Integrated Generation Capacity Expansion Plan (IGCEP) of 2021.
Therefore, Chinese companies can expect a supportive government attitude to investment in photovoltaic plants in Pakistan and the cooperation would complement both countries’ commitment to the socio-economic development of the whole region.
In Pakistan, the insufficiency of power which leads to surging electricity tariffs and foreign exchange expenditure on imported energy is aggravating the necessity for the country to be more self-sufficient in power generation.
Currently, thermal power still takes the bulk chunk of Pakistan’s energy mix, accounting for 59 per cent of the total installed capacity.
Importing the fuel on which most of power plants run has put a heavy burden on treasury. That is why government has been thinking for a long time to focus on the assets that are being produced in the country.
If solar is installed on every roof, those who suffer from heat and load shedding can generate their electricity at least all day, and if some surplus electricity is generated, they can sell it to the national grid.
They can also support their children and serve elderly parents, Musadik Masood Malik, Minister of State (Petroleum Division) said in an interview with CEN.
As a renewable energy source without fuel requirements, photovoltaic energy is significantly cost-effective when compared to imported energy, RLNG, and gas.
According to World Bank, Pakistan requires only 0.071 per cent of its total land area (mainly in Baluchistan) to achieve the benefits of solar power. If this potential is utilised, all of Pakistan’s current energy needs can be met with solar power alone.
An increasing number of companies and organisations are catching the tide as shown by the robust growth trend of Pakistan’s solar consumption.
As of March 2022, AEDB Certified Solar System Installers grew by around 56 per cent. Net metering-based solar installations and power generation grew by 102 per cent and 108 per cent respectively.
According to KASB analysis, it represents both government support and consumer demand & supply.
Since late 2016, solar panels have been installed in 10,700 schools in Punjab and more than 2,000 in Khyber Pakhtunkhwa.
Punjab schools that were fitted with solar power collectively save around Pakistani rupee PKR 509 million ($2.5 million) annually, which represents around PKR 47,500 ($237.5) being saved on a per school basis annually.
Currently, the installation of solar panels in 4,200 schools in Punjab and over 6,000 schools in Khyber Pakhtunkhwa solar panels is in progress, a KASB analyst told CEN.
As per the Indicative Generation Capacity Expansion Plan (IGCEP), in May 2021, Imported Coal accounted for 11% of total installed generation capacity, RLNG (Regassified Liquefied Natural Gas) accounted for 17 per cent, whereas solar only accounted for around 1 per cent.
It is expected that the reliance on solar energy will increase to 13 per cent and the reliance on imported coal and RLNG is expected to decrease to 8 per cent and 11 per cent respectively.