Experts review status quo of renewable energy sector

ISLAMABAD: Energy experts on Thursday debated on the status of renewable energy sector, saying that the mushrooming growth of self-generated electricity was a major threat to national grid.

The experts from across Pakistan's energy sector gathered to discuss the annual state of renewable energy in Pakistan, in a plenary hosted by the Sustainable Development Policy Institute (SDPI) on Thursday.

The discussions revealed both the progress made and the significant obstacles that still lie ahead in transitioning towards a more sustainable energy system.

CEO of Attock Refinery and Attock Gen Limited Adil Khattak opened the event with focus on the importance of sustainable development goals (SDG) in providing "affordable, sustainable, and clean energy for all”.

He pointed out that Pakistan was currently producing more energy than it needs, which was not only causing distribution inefficiencies but was also becoming a hurdle in transitioning towards renewable energy.

"Net metering punishes the have-nots for the purchasing power of the haves because those who can afford the cost of solar panels are moving off the grid already," Mr Khattak said.

However, he remained optimistic about Pakistan’s renewable energy prospects, stating that the country’s transition to renewables was not only "positive" but also "imperative", provided the challenges were addressed head-on.

Engr. Ahad Nazir from the Sustainable Development Policy Institute (SDPI) shared the Annual State of Renewable Energy 2024 report, offering a snapshot of Pakistan's current energy situation.

As of March 2024, Pakistan's total generation capacity stands at 42.134 GW, out of which line losses account for 2.5 per cent are distribution losses for 17 per cent. Of this, only 6.8 per cent comes from renewable sources, primarily wind, followed by solar, and then biomass, Mr Nazir said.

Company Secretary at United Energy Pakistan (UEP) Tanveer Afzal Mirza said despite political and economic challenges, the private sector had demonstrated a willingness to invest, particularly in the wind energy sector, which had attracted nearly $3 billion in investments.

Hussain Talib, Head of External Affairs at Unilever Pakistan, stressed the importance of collaboration in achieving zero emissions.

"Organisations cannot do this alone," he said, pointing to the Power Wheeling Coalition – a partnership of companies already working together to develop policies for renewable energy.

“But the implementation still stays with the government,” he added.

Mr Talib advocated for market liberalisation to allow a more dynamic energy market that could support green energy initiatives.

Tauseef H. Farooqi, former chairman of the National Electric Power Regulatory Authority (NEPRA), elaborated on diverse models of energy production. 

He criticised the current energy system, stating that it is “neither affordable, nor reliable, and certainly not sustainable."

Mr Farooqi explained that while private sector involvement was essential, the government must create profitable, long-term options for investors to thrive.

He also noted that unless battery storage prices decrease, consumers might increasingly turn to self-generation, making the grid redundant.

Mr Farooqi also shared details on the current status of the Carbon Trading and Bilateral Contract Market (CTBCM) in Pakistan.

He said NEPRA had already approved the plan in 2023, and all that is left now is the approval of the wheeling charges by the government.

“If the wheeling charges are affordable, we will soon see the CTBCM in Pakistan,” he added.

Responding to this, Daniyal Siddiqui from DSC Energy Ltd. said that fast-tracking CTBCM could stimulate investment and further the green finance goals of Pakistan.

He said there was a lot of interest from the industry towards this platform which would also make it more viable for them to move towards solar energy.

Imran Rana, spokesperson for K-Electric, shared that the utility company aimed to source 30 per cent of its energy from renewables. "Despite the political and economic climate, we have received a positive response from both financers and the government," Mr Rana said.

Managing Director of the Private Power and Infrastructure Board (PPIB) Shah Jahan Mirza said while Pakistan had made strides — generating 38 per cent of its energy from renewables in the last fiscal year – there was still much work to be done.

He pointed out that the country’s energy planning was based on GDP growth projections, which often did not align with actual demand, leading to inefficiencies in energy generation and distribution.

All participating experts agreed that the renewable energy sector is poised for growth, however they recommended that to make that happen “a coordinated, top-down approach is crucial”.

To reach net-zero emissions, the entire community needs to come together, he said.

This will require engagement from all stakeholders—government, private sector, academia, and civil society—to develop policies and infrastructure that support Pakistan’s renewable energy goals, Mr Mirza added.