Solar energy products are becoming very much attractive in our country. Pakistan has commended the use of grid-connected solar energy, rooftop solar installations and mortgage financing for home solar panels to boost uptake of clean energy. Government removed a 32.5 percent tax imposed on imported solar equipment in 2014-15 budgets. The aim was to bring down the cost of installing solar panels. This is a major boost that could accelerate use of solar energy and help Pakistan’s government cut power shortages in the long run. This bold step will increase demand for solar energy across Pakistan and decline the price of solar equipment.
The newly imposed taxes on the import of solar panels were due to the following pressure from business owners, the public and media. Consumers can now install rooftop solar systems and sell the extra energy to the national grid. The tariff that will be applicable for purchase of electricity from the consumer will be the same at which he has been billed by the company for electric power. It must be remembered in this context that net-metering will not only help consumers get uninterrupted power and energy credits through the year but will also help the government meet its power shortfall.
BANK’S LOAN FOR INSTALLATION
In order to further develop solar energy products the State Bank of Pakistan and the Alternative Energy Development Board (AEDB) has recently allowed the bank for the first time to finance rooftop solar installation with home mortgages. This step has been taken to create awareness about clean energy and provide loans for it on easy installments to customers. The bank would give loans to customers who want to convert their homes to solar energy. It will allow buyers to borrow against their home’s value. The loan would be particularly beneficial for people who otherwise cannot afford rooftop solar installation.
It is forecasted that net-metering and private sector financing for solar installation would revolutionize the use of renewable energy in Pakistan.
For agricultural development schemes for the next fiscal year will include new initiatives to facilitate a greater use of solar energy on farms and fields with active financial support of banks.
The Sindh government is in serious talks with two foreign companies to explore new ways of harnessing solar power. Its planning and development department has been working on modalities of public-private partnership projects in this regard.
The USAID partnership with Pakistani banks (for clean energy project financing) is one of the many funding sources. ADB has also agreed to partly fund such projects. The USAID signed $88m funding agreement with five banks in Pakistan (HBL, MCB Bank, Faysal Bank, Meezan and JS Bank) to help finance establishment of small-scale clean energy projects.
In Punjab, the provincial government is set to re-launch, with the help of some foreign fund providers, an old scheme to convert hundreds of thousands of conventional tube wells on solar power. The ongoing scheme of selling solar-powered tube wells at subsidized rates will also continue.
In the last five years, solar panels’ use has been growing in rural areas, both at households and on farms and fields. The Khyber Pakhtunkhwa government has also announced a similar plan. The provincial chief minister informed media that his government was in talks with the World Bank to seek funds for farmers who are willing to replace their electricity-fed tube wells with solar-powered tube wells.
Balochistan government’s negotiations with Canada for setting up solar power plants of 50MW in 20 districts are progressing well.
Solar panels’ use has been growing in rural areas, both at households and on farms and fields. But some hurdles keep growth of solar energy limited. Low-quality imported solar panels in 2012 under an official support scheme in Sindh feared many farmers who had then installed these panels at their farms. Now for majority of those who use solar panels for running tube wells or powering wheat threshers or fodder cutters, is quick fast becoming a dependable source of power connection.
If the Sindh province wants to let agriculture go solar at a rapid speed, it must introduce solar tower technology. In this technology sunrays are allowed to beat down on a large surface area and both sunlight and the heat obtained during the process are used to produce electricity. Growers in Sindh now often use solar panels in tunnel farming and poultry farming. Besides small silos are also being lighted with solar LED lights. In Balochistan, irrigation-scale water wells are being run on solar power.
A USAID report on Pakistan’s alternative energy prepared in 2016 says solar energy program has enough potential that can be harnessed with a mix of right policy measures and foreign and local entrepreneurs’ participants. Pakistan has a range of major solar projects in the pipeline, amounting to more than 4,400 megawatts in potential power.
Germany is a world leader in producing solar energy and uses detailed solar maps to assess its own solar resources.
Pakistan’s data has been made public as part of the Global Solar Atlas website, giving commercial scale projects ready-to-use seasonal and monthly data.
Disheartened with constant power cuts, consumers are already installing small-scale roof-top solar systems for their homes and businesses.
Pakistan’s National Electric Power Regulatory Authority (NEPRA) has issued guidelines for net metering so consumers can now sell excess solar energy they produce back to the grid. Some banks have started financing with speed home solar systems, which are cropping up across the country.
The Islamabad Electric Supply Company has introduced net metering, and other power companies in large cities such as Lahore and Karachi will be following suit in a matter of months, not years. The government still needs to simplify connection rules and procedures for small-scale solar power to be more widely adopted.
Pakistan already has one major solar park ─ the Quaid-e-Azam Solar Park in Bahawalpur, built with Chinese investment. It produces 400 megawatts with plans to rise to 1,500 megawatts of solar production. Many other companies from countries like Germany and the United States are coming into Pakistan to invest in solar energy.
Pakistan can cut carbon emissions to a significant extent and access international climate financing by promoting solar energy, besides overcoming its energy crisis.