Off Grid Rural Electrification In Pakistan Environmental Sciences Essay

Pakistan is struggling with its worst energy crisis in the history. Currently, approximately 66% of power generation in Pakistan is derived from fossil fuels (primarily oil and gas) followed by hydroelectricity (30%) and nuclear energy (3%). All that happening when only about half of its population has access to electricity. In this situation, it is inevitable to switch to clean, sustainable and abundantly available renewable energy resources for power generation. The government attempted to promote renewable energy technologies in 2006 by introducing its first renewable energy policy. However, the effects of this policy have not yet reached to the population still without electricity.

In order to achieve objectives of 100% energy coverage, there is a strong need of separate renewable energy policy for off-grid electrification projects. Also, more research is required in exploring the real renewable energy potential specifically for different locations and demarcation of these off-grid rural areas so that they can be supplied with sustainable off-grid energy solutions.

Introduction

Today, only 55% of Pakistan’s population has access to electricity (Yazdanie 2010). Most of these regions being difficult terrain rural areas where extending current power grid is either difficult or very expensive. As electricity defines the economic growth of a region, it is vital that these rural areas be provided with electricity. On the other hand, the nation is currently facing a 3 GW power supply shortage – the most severe energy crisis to ever hit the country (Harijan, Uqaili and Memon 2008). While the energy shortage continues to grow, abundant indigenous sustainable energy resources such as wind, solar and biomass remain virtually untapped (Yazdanie 2010). Thus the quickest, easiest and cheapest way to provide electricity to these regions is by utilizing renewable energy (RE) resources. ‘Off-grid’ rural electrification refers to the provision of electricity independent from the main electrical grid. 1

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Historically, the predominant model for electrification in developing countries has been grid extension and conventional energy‐powered mini‐grids developed by large, state‐owned utilities. Recently, the spectrum of electrification models has widened, including a long list of off‐grid solutions, such as wind home systems and solar home systems, amongst many others (Hagler Bailey Pakistan, Mercados EMI Spain 2009).

The government of Pakistan (GoP) attempted to promote the adoption of renewable energy technologies (RETs) in 2006 by implementing its first RE policy. However, this policy has had limited success and faces a number of challenges (Yazdanie 2010). These challenges must be clearly identified and addressed in order to pave way for the sustainable energy provision in the rural areas of the country.

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1 For purposes of this literature review, ‘off‐grid’ rural areas are defined as those that are currently unelectrified, are not included in any national or regional grid expansion plan for the next ten years, and are located more than 20 km from existing power grid(s).

Literature Review

This literature review is intended to provide an overview of the actual renewable energy potential of the country and the opportunities related to it for rural electrification in Pakistan. The current renewable energy policy will also be examined in the context of off-grid electrification. The objective of this paper is to understand the challenges the current renewable energy policy is facing in materializing the off-grid electrification in the rural areas and to discuss how these challenges can be addressed.

Opportunities: Renewable Energy Potential of Pakistan

The potential for renewable energy resources to provide electricity to rural areas of Pakistan is significant. Renewable energy projects have the potential to improve energy security, provide socioeconomic benefits, reduce local pollution and mitigate climate change (Masud 2009). Further, due to the decentralized nature of renewable energy projects, they have the potential to provide electricity to remote and rural areas, thereby helping to alleviate poverty and reducing the need to collect and burn biomass fuel (Masud 2009).

2.1.1 Solar Energy

Pakistan lies in a region of high solar irradiance; as such, it is ideally suited for solar energy projects. Pakistan receives about 15.5×1014 kWh of solar irradiance each year with most regions receiving approximately 8 to 10 sunlight hours per day (Yazdanie 2010). The projected installed capacity of solar photovoltaic power is estimated to be 1600 GW per year, providing approximately 3.5 PWh of electricity (a figure approximately 41 times that of current power generation in the country) (Yazdanie 2010) (Harijan, Uqaili and Memon 2008).

2.1.2 Wind Energy

Wind energy has also been shown to have strong technical potential in Pakistan, particularly in the southern regions of Sindh and Balochistan. Pakistan has approximately 1000 km of coastline with steady average wind speeds ranging between 5-7 m/s (Yazdanie 2010). The projected installed capacity for wind energy projects is estimated at 122.6 GW per year, providing about 212 TWh of electricity (a figure approximately 2.5 times that of the current power generation level) (Yazdanie 2010) (Harijan, Uqaili and Memon 2008).

2.1.3 Biomass Energy

The availability of biomass in Pakistan is also widespread. Approximately 50 000 tonnes of solid waste, 225 000 tonnes of crop residue and over 1 million tonnes of animal manure are produced daily. It is estimated that the potential production of biogas from livestock residue is 8.8 to 17.2 billion cubic meters of gas per year (equivalent to 55 to 106 TWh of energy) (Yazdanie 2010). Additionally, the annual electricity production from bagasse (the fibrous residue remaining after sugarcane or sorghum processing) is estimated at 5700 GWh; this figure is about 6.6% of Pakistan’s current power generation level (Yazdanie 2010) (Harijan, Uqaili and Memon 2008).

2.1.3 Hydro Energy

Hydro is the only sustainable energy resource which Pakistan has effectively employed for large-scale power generation. Currently, Pakistan has an installed hydropower capacity of approximately 6.6 GW (Yazdanie 2010). This figure is only 16% of the total hydropower potential in Pakistan, estimated to be about 41.5 GW (Yazdanie 2010) (Harijan, Uqaili and Memon 2008).

Undoubtedly, renewable energy resources in Pakistan are abundant and present significant potential for the off-grid electrification. But the availability of renewable energy resources alone provides little indication about the success of renewable energy project development in a country. No matter how much technical potential exists, it is of little use unless an effective policy bolsters development (Yazdanie 2010). To this end, Pakistan instituted its first renewable energy policy in 2006. However, this policy has stimulated limited growth for off-grid electrification implementation. This policy will now be examined in the context of off-grid rural electrification.

Renewable Energy Policy of Pakistan

The Alternative Energy Development Board (AEDB) was established in 2003. The objective of this institution was to develop renewable energy policies for the promotion of wind, solar and small-scale hydro power projects (Khattak, et al. 2006). AEDB introduced the Policy for Development of Renewable Energy for Power Generation in 2006. This is Pakistan’s first energy policy aimed specifically at the promotion of renewable energy power projects. The goal under this policy is for RETs to provide 10% of Pakistan’s energy supply mix by 2015. The policy focuses on solar energy, wind energy and small-scale hydro power projects (Hussain 2007) (Yazdanie 2010).

Salient features of the policy related to off-grid projects are briefly outlined below:

Private investors are invited to submit proposals for small-scale standalone projects (isolated grid power projects)

For all non-IPP (Independent Power Plant) projects, Letters of Intent (LOI), Letters of Support (LOS) and Implementation Agreements (IA) with the government are not required.

There are no customs or sales taxes on equipment.

There are no income taxes (Government of Pakistan 2006) (Bhutta 2008) (Yazdanie 2010).

Policy Strenghts

The 2006 Policy for Development of Renewable Energy for Power Generation presents several valuable initiatives which support the development of RETs in Pakistan. The policy encourages the adoption of small-scale, deregulated and standalone systems which are especially important in the context of remote and rural areas (Yazdanie 2010). Power transmission infrastructure in Pakistan is limited and mostly unavailable in rural areas; dependence on the grid and its reliability is eliminated by using standalone systems. Additionally, transmission losses are avoided (Khattak, et al. 2006). By deregulating small-scale power projects, transaction costs are also reduced and any able person may set up a power project (Bhutta 2008). The net metering and billing system for small-scale projects provides advantages as well. This system results in optimized capacity utilization and is economically beneficial for dispersed, decentralized means of power production (Bhutta 2008) (Yazdanie 2010).

Recent Initiatives

Several off‐grid RE projects have recently been initiated in Pakistan with varing outcomes. Probably, the most ambitious project has been the Khushaal Pakistan program (2001), which envisaged 100% electricity coverage by the end of 2007, a target which was obviously not accomplished (Haigler Bailey Pakistan 2009). Currently, the most active project is the Roshan Pakistan program. The objective is to provide electrification services to 7,874 isolated villages. So far, 400 villages have been electrified through this program in Sindh and Balochistan provinces (Haigler Bailey Pakistan 2009).

Challenges

The 2006 policy has stimulated some growth in the renewable energy investments and the initiatives have been mentioned. However, the fact remains that these initiatives are not enough to meet significant targets in the off-grid electrification. The challenges that the rural development faces in the context of off-grid electrification and policy issues are discussed below.

2.5.1 Lack of National Off-grid Policy

Pakistan’s 2006 RE policy provides only a brief set of guidelines for the development of small off‐grid hydel projects, with some provisions applying to other RETs as well. At present, there is no national policy for off‐grid electricity investments (Haigler Bailey Pakistan 2009). Additionally, the guidelines assign identical roles to the AEDB and provincial governments for renewable energy sourced-electricity (RES‐E) project implementation, and this overlapping can be confusing and counterproductive (Haigler Bailey Pakistan 2009).

2.5.2 Demarcation of Off-grid Areas

A critical issue in the current rural RE deployment strategy in Pakistan is the absence of a clear demarcation of off‐grid areas and/or isolated/scattered populations. Such a definition should define the geographical areas for which the grid extension would remain uneconomical into the near future (say, next decade). This is an essential first step in designing a rural electrification project, as it provides a means for understanding key characteristics of the unelectrified villages to be targeted (Haigler Bailey Pakistan 2009).

2.5.3 Targets and Incentives

It is of vital importance that medium term targets should be set. About 50% of all off‐grid unelectrified villages currently identified should be electrified by end‐2014. The federal government should provide subsidies for capital investments to the extent of 70% of the total investment required for each RE project (Haigler Bailey Pakistan 2009).

2.5.4 Financing

It is also vital that sufficient RET financing is made available to stimulate and encourage project development. Aside from government subsidies, innovative funding programs should be developed, particularly for small RET project investors (Mirza, Ahmad and Harijan, et al. 2009) (Yazdanie 2010). In order to provide funding to off‐grid projects, an Off‐grid Rural Electrification Account (OGEAC) in the budget for the AEDB should be created (Haigler Bailey Pakistan 2009).

2.5.5 Institutional Barriers

Pakistan has a history of poor coordination and cooperation between governmental agencies. No governmental body was responsible for the planning and development of renewable energy policies in Pakistan prior to the founding of AEDB. Prior to AEDB, there were a number of disparate governmental organizations with uncoordinated and limited objectives (Khattak, et al. 2006). A lack of coordination and cooperation between government agencies, institutions, ministries and different stakeholders continues today (Mirza, Ahmad and Harijan, et al. 2009) (Yazdanie 2010).

2.5.6 Lack of Training and Capacity Building

Training, capacity building and knowledge transfer are of particular importance for the successful implementation of RE off-grid projects (German Energy Agency 2010). Especially in remote regions with limited market structures, the capacities of local partners to install, operate and maintain off-grid systems need to be developed (German Energy Agency 2010). At present, there is lack of both trained personnel and training facilities for the installation, operation, and maintenance of RETs (Khattak, et al. 2006).

Conclusion

Pakistan faces a number of challenges in its effort to promote renewable energy technologies for the rural development. The 2006 policy has certainly made important first step but in order to achieve its targets, a national off-grid renewable energy policy must be made. These off-grid areas should then be marked for designing rural electrification projects. Medium term targets should be defined and incentives specifically for off-grid electrification projects should be announced. It is of vital importance that government agencies, provincial governments and different stakeholders cooperate with each other for proper information flow and successful project implementation. Finally, community involvement and capacity building is of particular important for the off-grid rural electrification projects.

The path for future development is not simple, but a solution certainly lies in renewable energy technologies to achieve 100% electricity coverage. Pakistan must consider the social, economic and environmental benefits of renewable energy technologies for off-grid electrification. Investing in sustainable energy technologies today will pave the way for future development of the country and its people.