As the country entered the winter season, the load-shedding of natural gas also began in multiple cities and the citizens had to face yet another challenge in their lives. The outage of natural gas is driven by its high demand from November to February because of the consumption at an industrial and commercial level along with heating appliances in residential areas. The fact is that natural gas reserves are declining in Pakistan. The demand is of course increasing not only on an industrial basis but also due to surging numbers in population in urban centres.
Multiple options such as the import through pipelines or Liquefied Natural Gas (LNG) from gas-producing countries could be an alternate source but that is an expensive option. Similarly, gas exploration is on the agenda and Pakistan can surely look into finding larger reserves but that is going to be a long-term option. The recommended way on a short-term basis is to replace natural gas with electricity, which must be clean, green, and affordable to the majority of the masses in the country. Renewable energy sources such as solar and wind power plants are the quick fix in the present situation in Pakistan which will not only enhance the capacity generation of electricity across the country but also save foreign exchange of the country.
Different countries in the world have opted for an all-electric policy for home appliances and transportation and the idea is emerging as a feasible roadmap for meeting the future’s energy requirements. Regional counterparts such as India and Sri Lanka have no reserves of natural gas. Many developed countries are investing in the generation of solar electricity for residential, commercial, and transportation because natural gas is also a hydrocarbon that is affecting the environment and contributing to adverse climate change. The world is moving towards green energy to prevent itself from the harmful and devastating impacts of increasing carbon footprint and climate changes which have already caused natural catastrophes, resulting in fatalities, and destruction of habitats, infrastructure, and damage to the economy.
UN Sustainable Development Goal (SDG) 7 also focuses on a concerted global effort to ensure access to affordable, reliable, sustainable, and modern energy for all. Late but right, Pakistan’s government decided to take a commendable initiative to produce renewable energy mainly from Solar power projects, which is the most suitable way for a sustainable energy solution for Pakistan. According to the Indicative Generation Capacity Expansion Plan (IGCEP) 2020, prepared by the National Transmission and Dispatch Company, Pakistan will have to increase its power generation capacity to 57 GW by 2030. Consequently, the country will have to invest around $32 billion by 2030 to develop new power projects. According to the plan, renewable energy is also on the cards for an environmentally cognizant alternative to meet future needs.
A few months ago, Prime Minister Shahbaz Sharif gave the go-ahead for the execution of 10,000 megawatts of Solar energy projects in the country. This plan will attract huge local and foreign investment in the country in a short period and will encourage private sectors including power utilities and industrial units to set up solar power plants.
It is said that the country would witness different solar energy parks in the future once the trend is streamlined and more steps are taken in this regard including investment policy, tax holidays, and bank financing facilities. The Sindh solar energy project under which KE is collaborating with the Government of Sindh for the addition of renewable energy is another initiative that will help to increase the supply. The inflows of foreign investment in the country will also produce innumerable benefits to the economy including the establishment of assembly or manufacturing plants of Solar energy, generation of skilled human resources, and last but not least, the savings of foreign exchange to the national exchequer. Besides the policy initiatives, the most important factor to attract investment in green energy is to safeguard the investors’ interest in the country through concrete steps, including a conducive environment and ease of doing business.
The government should address the issue of circular debt in the energy sector and resolve payment issues of the power utilities, particularly from its end. Once the existing utilities perform well operationally and financially, the energy sector will welcome huge local and foreign investments in the country. This investment will eventually have spilling effects on the consumer – the cheaper the electricity production, the lower the cost to the consumer in the form of fuel charge adjustments. In parallel to this, renewables will also increase the overall supply. So positive investment environment is the key to citizens’ socioeconomic welfare.