Solar Energy Potential of Pakistan

German Development Cooperation – Pakistan Renewable Energy & Energy Efficiency Project

Solar Energy Potential & Market in Pakistan Bernhard Meyhöfer Principal Advisor – GIZ-REEE

Supported by:

12.09.2012

Seite 1


Agenda  Energy Mix Projections  Solar Energy Potential  Status of Solar Projects  Development of Upfront Tariffs  Q&A

12.09.2012

Seite 2


Million Ton of Oil Equivalent (MTOE)

Energy Mix Projections Vision 2030-Planning Commission 400

361.31

350 300

Nuclear

255.37

250

Renewable 177.35

200

Hydro Coal

150

120.18

Natural Gas Oil

79.39

100 50.8

50 0

2004

2010

2015

2020

2025

2030 12.09.2012

Seite 3


Indigenous Energy Projection (Vision 2030, Planning Commission)

12.09.2012

Seite 4


Solar Energy Potential of Pakistan

12.09.2012

Seite 5


Solar Energy Potential of Pakistan Pakistan receives one of the best solar-irradiation in the world Average solar irradiation 5-7 kWh/m2/day

It can produce over a million MW of Solar PV electricity provided adequate space for installation (Source: NREL-USAIDstudy)

Market is at developing stage in both Solar PV and Solar Thermal (domestic & commercial hot water applications)

12.09.2012

Seite 6


Solar Energy Potential of Pakistan

- contd.

 Presently 5000-7000 MW capacity deficit  National natural gas reserves are rapidly depleting  Government subsidy for domestic/commercial natural gas consumption is slowly being withdrawn  Plans by Government to reduce trade deficit from fossil fuels (presently exceeding10 billion USD annually) by reducing imports  Plans by Government to increase the share of RE particularly Solar in the total energy mix of Pakistan

12.09.2012

Seite 7


Status of Solar Projects Solar PV Off – Grid Applications  40,000 villages presently un-electrified  Grid extension technically and economically not feasible for next 20 years to reach remote areas  8000 villages identified for Off-Grid Solar PV applications  Approx. 100 villages presently electrified by Solar Home Systems (SHS)  Microfinance based solar home system programs are in initial stages of development

12.09.2012

Seite 8


Status of Solar Projects Solar PV Grid Connected Applications  Tax and custom duty exemption in place by Government for Solar products  LOIs for 9 projects with cumulative capacity of 228 MW issued by AEDB under RE Policy  Government of Punjab (DoE) has allocated approx. 5000 acres of public land for solar PV installations  Government considering switching 280,000 electric tube wells onto Solar PV with Government allocation of funds under process

12.09.2012

Seite 9


Status of Solar Projects Solar Thermal - Hot Water Applications  Approx. 10,000 Solar Water Heaters (SWHs) installed in both rural and urban areas producing 2 million liters per day  Approx. ten installations in various industries, producing 80,000 liters per day

12.09.2012

Seite 10


Development of Upfront Tariffs  Following wind power, Government has in principle agreed to upfront feed-in tariff regimes for solar PV projects up to 50 MW capacity –  Formal reference for solar PV upfront feed-in tariff is expected to be submitted to NEPRA within third quarter of 2012 by AEDB, with tariff expected to be announced within the year 2012.  At present seven solar PV investors are actively involved in obtaining a feed-in tariff for their projects with two feasibility studies submitted

12.09.2012

Seite 11


 Barriers for Solar Energy  Technology  Week technology basis (design, specification, installation, O&M) on solar technologies  Low level of experience in larger scale application (industrial scale, on-grid)  Grid connection issues (grid code)

 Policy & Institutional  Lack of feed-in tariff (under development 2012)  Lack of incentive schemes (promotion schemes, credit lines, microfinance etc.)  Image of solar technology (expensive, unknown…) 12.09.2012

Seite 12


 Recommendations for investors  Identification of suitable local companies for joint ventures  ensure presence at Pakistan  Development of local capacities (technology, management) on solar technology  Contribute (actively) to dialogue on solar energy application – awareness creation  private sector organized seminars/workshops etc. for govt. agencies and suppliers/consultants, academia

12.09.2012

Seite 13


THANK YOU

12.09.2012

Seite 14