Passenger: “What are you saying? Only yesterday I paid Rs. 20 for the bus fare, now you are charging me Rs. 30?”
Bus conductor: “Yes, that was a day ago, don’t you know the government jacked up prices of petroleum prices last night. We, transporters, cannot do anything but to increase fares.”
Passenger: “This is just unfair! The government should just kill us, instead of making us suffer like this.”
Bus Conductor: “Don’t make a scene, sir. We too, have to run our kitchens, I cannot sell my clothes to feed my children.
These discussions have now become customary in Pakistan, especially in the wake of recent price hikes in petroleum product rates announced by the government in just a span of a few weeks.
The decision, which the incumbent government says was necessary and in the larger interest of the country’s economy - which remains engulfed with a number of crises i.e. the balance of payments and depreciating foreign exchange reserves - has driven up inflation while instigating the masses.
A typical response by the government to date has been to blame its predecessors while constantly reminding the public that energy prices remain high in the international market.
The latter part of the argument, however, is accurate as a rise in demand following the removal of Covid-19 induced measures and the ongoing Russia-Ukraine conflict have severely impacted global supply chains driving up commodity prices, especially energy.
World priorities too, have shifted in the wake of recent developments and countries especially in the West are expressing concern for their energy security, and are questioning their overreliance of energy needs on Russia or any other country for that matter.
This has pushed the developed world to pursue more indigenous sources, especially reviving interest in renewable energy resources, which are sustainable and are increasingly becoming more cost effective.
Moreover, in Pakistan, a country with a growing population of over 220 million people, where the demand for energy is only about to rise in the near future, it is pivotal for the country’s decision-makers to address the vulnerabilities of its energy sector.
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According to the latest figures from the National Electric Power Regulatory Authority (NEPRA), the total cost of generating electricity in the country jumped 131%, hitting Rs13.15 kWh in May 2022 compared to Rs5.7 kWh in May last year.
The increase in total cost was led by rise in power generation rate for furnace oil (FO), Re-gasified Liquefied Natural Gas (RLNG) and coal, which stood at Rs33.68, Rs27.93 and Rs30.09, respectively.
Meanwhile, looking at the country’s energy mix, non-renewable energy sources account for over 70% of power generation in the month of May.
The remaining is made up of renewable sources of energy, with hydroelectric power leading the way with 24% of the power generation, whereas wind accounts for 5%, while solar power contributed only 1% to country’s energy needs, with a generation of only 90kWh last month.
The contribution of solar can be enhanced massively in Pakistan, which as per a World Bank study in 2020, cited its tremendous potential to generate solar power.
“Utilising just 0.071 %of the country’s area for solar photovoltaic (solar PV) power generation would meet Pakistan’s current electricity demand” stated the report two years ago.
The demand for power generation may have risen since 2020, but so have improvements in solar technology.
Pakistan also does not need to look very far to gauge the potential of solar power, as two of its next door neighbors i.e. China and India, have quickly emerged as some of the largest producers of solar energy, adding plenty giga-watts of solar generated electricity every year to their respective grids.
According to the International Energy Agency (IEA), China remains the leader in terms of cumulative capacity with 253.4 GW installed - almost one third of the global PV installed capacity.
Furthermore, less than a 100km away from Pakistan, sits Bhadla solar plant. Located in Rajasthan, India the plant was recently crowned as the largest solar park in the world with a total capacity of 2245 MW, as our eastern neighbor plans to build more such parks in the coming years.
This should be taken as a case study, as Pakistan, quite like India, possess vast expanses of desert lands located in Sindh and Punjab - the Thar and Cholistan - that receive ample sunlight and little rainfall throughout the year - ideal to be converted into solar power generation hubs.
This would not only help in additional electricity generation for the country facing regular power outages, but would also shift its reliance from expensive fossil fuels, which are largely imported and burn a hole in the national exchequer.
Pakistan’s oil import bill has already shot up to $20 billion in the first eleven months of this fiscal year alone - a jump of over 99% showed data released by the Pakistan Bureau of Statistics (PBS).
With international prices remaining well above $100 per barrel, increasing imports would only burden the fragile economy.
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Similarly, rates of other energy commodities have also risen substantially, compelling the government to raise electricity rates. This would not only hike inflation but render local industries uncompetitive in the international market as manufacturing cost rise.
Therefore, shifting to solar is no longer a climate change goal for Pakistan, rather, a much-needed step to ensure its economic growth.
However, an authority is needed to be developed on the governmental level that includes both public and private stakeholders.
The authority will be responsible not only for installing and implementation of a solar setup, but also for carrying out the Research & Development needed to achieve self-reliance in the renewable energy sector.
The government has advocated for renewable sources of energy as Minister for Power Khurram Dastagir Khan recently stated energy sources such as hydel and solar energy were the way forward.
However, recent measures announced by the government in its budget can be noted as half-hearted as while they did announce sales tax exemptions on the import of solar panels and their distribution, they did not provide similar relief on goods needed to convert that solar energy to power i.e. batteries.
Meanwhile, on a positive note, the State Bank Pakistan (SBP) announced an extension on the financing scheme for renewable energy for next two years, up to June 30, 2024.
The scheme provides concessionary financing for large renewable energy power projects as well as for small-scale renewable energy solutions.
The good news is that there is already a rising trend in the adoption of solar, both for personal and industrial usage among the populace, which is being driven by rising electricity costs in the country.
However, an impetus is needed to kick-start a solar revolution in Pakistan.
The article does not necessarily reflect the opinion of Business Recorder or its owners