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Fueling up on renewables

Square Space
Pakistan’s energy mix is perpetually dominated by fossil fuels. Will environmental degradation and the lowering cost of renewables push a rethink?
by Kunwar Khuldune Shahid

On September 7, Fortescue Metals Group Chairman Andrew Forrest met with Prime Minister Imran Khan to express the Australian firm’s interest in Pakistan’s renewable energy sector.  Around the same time, Karachi Nuclear Power Plant’s unit K2, the first ever overseas unit to use Chinese Hualong One technology, completed its Hot Functional Tests. In August, Green BRI Centre Director Dr Christoph Nedopil Wang said that Pakistan can help increase the overall share of the renewable and sustainable energy investments in the Belt and Road Initiative.

These developments came in the aftermath of Pakistan’s Council of Common Interests ratifying the Alternative and Renewable Energy Policy on August 6. The CCI meeting focused on the major gas crisis brewing in Pakistan, which could result in the worst ever shortage in winter 2021-2022 if urgent changes aren’t undertaken. A long impending concern over the sharing of Windfall Levy between the center and provinces was also discussed to help streamline wind energy projects in the country. The Alternative and Renewable Energy Policy vows to increase the renewable share in the energy mix, and looks to develop alternative sources in addition to hydroelectric power, like solar, wind, geothermal and bio.

According to Pakistan Economic Survey 2019-20, thermal power dominates Pakistan’s overall energy mix with 58.4%, albeit signifying a 4.6% decrease over 12 months. Over the past year, the share of hydel power has increased from 25.8% to 30.9%. Meanwhile, nuclear—whose billing as renewable energy is debated more so than its status as green—has jumped from 3% to 8.2% in the mix. The share of the remainder of renewable energy sources, which the government is now vying to increase, shrunk over the past year from 8.2% to 2.4%.

Renewable energy options have been mulled in Pakistan since the 1980s. A Renewable Energy Policy framed in 2006 aimed to provide 15% of power by 2015. Experts underline a wide array of reasons for its lack of fulfillment, including monopoly of the conventional power suppliers and the traditional higher costs of renewable technology. Fossil fuel energy sources in Pakistan have remained heavily subsidized, while the governments have periodically increased the tax on solar and wind energy equipment.

The Quaid-e-Azam Solar Power Park, designed to generate 100 MW, is one of the few CPEC affiliated projects to cater to renewable energy production. Credit: Geo

Climate of change

Where the world’s power generation focus fast evolved in the latter half of the previous decade, in the aftermath of the Paris Agreement, with green energy becoming a louder rallying cry than ever and access to clean energy being deemed a basic human right, this particular transformation has drastically escalated in the aftermath of the covid-19 pandemic. With global lockdowns resulting in clearer skies, and cleaner air, the world over during the first couple of months of the pandemic, calls for environmental friendly policies—including a swift and significant rise in the renewable energy share—gathered impetus.

In urban centres of Pakistan, NO2 emissions dropped by up to 56% in the first two months of the pandemic, where air pollution—originating in the transport, energy and industrial sectors in recent years—has reduced life expectancy by two years on average.

“Has the lesson that air pollution can best be curbed by reducing emissions by transport, energy or industrial sectors been learnt?  Or is the EPA [Environmental Protection Authority] Punjab focusing on brick kilns and stubble burning again?” environmental lawyer and Climate Action Now! activist Ahmad Rafay Alam asks while talking to MIT Technology Review Pakistan.

Those still defending fossil fuel based energy often use the baseload argument—the claim that the presence of fossil fuel in the energy mix is necessary to ensure the fulfillment of overall power needs—and have historically underlined the higher economic cost that renewable energy brings for financially crippled countries like Pakistan. Many experts have, however, urged investment in green technology to go parallel to the existing fossil fuel based plants. If the only future investment is in renewables, the share of nonrenewables would decrease. Even so, the past couple of years have actually seen a massive reduction in levelized cost of renewable energy. The cost per power unit from wind and solar power plants has dropped by up to 90 percent in certain parts of the world.

“Tariffs for renewables in Pakistan are now cheaper than fossil fuel alternatives.  There is no financial reason to remain committed to energy that produces greenhouse gases and air pollution,” maintains Alam.

Karachi Nuclear Power Plant. Credit: Power Technology

Where critics argue that renewables can’t provide for the baseload required to operate the grid, Alam maintains these concerns are largely misplaced, especially as the prices and capacity of battery systems improve by leaps and bounds, adding that renewables will operate better on decentralized grids rather than the large and old existing one.

“So a transition to renewables can properly give results when coordinated with an upgradation of the grid system.  The existing grid has massive problems, especially its generation of the crippling circular debt,” he adds.

Vicious circle

While Pakistan has added over 10,000MW in power generation in the past five years, to take the overall capacity to 34,000MW, the sector remains marred by multiple crises. These include Rs 2.2 trillion in circular debt amassed owing to inefficiencies of distribution companies like Quesco and Pesco, line losses, and the failure to recover the entirety of the power billing from the consumers. As a result, prolonged power outages returned to the urban centers this year.

Experts deemed it a direct corollary of the distribution system undergoing mammoth losses, with nearly one-fifth of all electricity produced not being paid for. Some point to the fact that it is considered politically unwise to force poorer consumers to pay for electricity. There is widespread corruption and meter tampering as well.

“Around 20-25% of the energy we produce is stolen. Only around 85-90% of due bills are received. Meanwhile, the energy contracts are such that power input itself is expensive,” delineates Farrukh Saleem, former financial and energy advisor to the incumbent Pakistan Tehrik-e-Insaf (PTI) government.

CPEC to connect China and Pakistan through road and infrastructure dominated by energy projects. Credit: Tribune Reloaded

China-Pakistan energy concerns

Saleem, like many critics of Pakistan’s energy policies, argues that the energy deals agreed as part of the $62 billion China Pakistan Economic Corridor (CPEC) were shortsighted. Two thirds of CPEC’s energy projects are coal-fired at a time Beijing is shutting down fossil fuel energy plants at home.

Given the evolving realities, experts have urged the government to consider revamping energy projects, including those affiliated with CPEC. Government sources confirm that this attempt was originally made in August 2018, immediately after the PTI government came to power. However, the move was forestalled owing to differences between the Chinese and Pakistani governments.

Beijing was critical of CPEC’s potential flaws being openly discussed in Islamabad. The agreements, seen as skewed and outdated by many, were being dissected on national media, which did not please the Chinese leadership.

“China doesn’t want you to do anything publically. They are willing to renegotiate, but not to make the negotiations a national debate on the media. However, the government perhaps wanted to indulge in political point-scoring. China has massive interests in Pakistan, and if we work according to their temperament, we can fulfill our interests as well, including those in the energy sector,” believes Farrukh Saleem.

Energy experts say that development of windmills in Pakistan can be discussed with China, including production units for wind turbines and blades. India is locally manufacturing units of windmills, which have resulted in windmills powering 2,000-3,000MW annually. China, meanwhile, multiplies its wind production capacity by tenfold every year.

Similarly, solar energy continues to be touted as a solution to power crises the world over, with the planet Earth receiving about 100,000TW worth of solar energy every hour. In September 2015, China helped build then world’s largest solar farm. The Quaid-e-Azam Solar Power Park, spread over 200 hectares of flat desert outside of Bahawalpur designed to generate 100 MW, was one of the few CPEC affiliated projects to cater to renewable energy production.

An agricultural country, with biomass potential of 50,000 GWh per year, Pakistan has also been urged to incorporate bio-energy in the mix, which has more potential to reach rural areas. Islamabad and Beijing have already vowed to increase agricultural cooperation, much of which is centering new technologies to help improve yields. Experts say agricultural cooperation can be further aligned with a joint commitment to renewable energy.

Smog, briefly, makes Lahore one of the world’s most polluted cities every year. Credit: AP

Going nuclear

For many analysts, nuclear energy remains a major field where there’s scope for much cooperation between the two countries. The Pakistan Atomic Energy Commission had planned to have nuclear power generation capacity of 8,600 MW in 2020. While Pakistan refusing to sign the Nuclear Non-Proliferation Treaty (NPT) has become a hindrance for the sector, owing to global restrictions, experts underline the massive potential that exists. They also reiterate that in China there is a nascent nuclear power industry looking to invest in developing nuclear power technology.

In Chashma, China has already installed four 300MW reactors. In 2014, the China National Nuclear Corporation began constructions on two 1,100MW reactors in Karachi. They cost $5 billion each, with 80% of the funds loaned by China. However, concerns surrounding their safety remain.

“When completed in 2022/2023, the two reactors will operate in close proximity to a city with almost zero capacity for disaster management, exemplified by a recent near total breakdown lasting several days because of excessive rainfall.  Pakistan is so far the only country to which China exports nuclear reactors,” nuclear physicist Pervez Hoodbhoy tells MIT Technology Review Pakistan.

Hoodbhoy is also critical of Pakistan’s over-reliance on fossil fuel energy, saying that renewable only gets “lip service but has low priority” in the country. He points towards coal deposits in Thar and Balochistan being seen as strategic resources to be intensely mined over the next few decades.

“Bucking global trends, the government is planning for coal energy that will be nearly 70% greater than that from renewables by 2040. This will make Pakistan a significant producer of greenhouse gasses, which presently it is not,” he underlines.

PM Imran Khan-led Pakistani delegation in talks with its Chinese counterparts in November 2018. Credit: Radio Pakistan

In the mix

Energy and environmental experts further urge Pakistan to address its hydro share, stressing that while hydroelectric power is renewable, it isn’t clean energy. The environmental impact of building and maintaining dams remains high and it will further contribute to greenhouse gasses.

“The methane emitted by dams due to organic matter that has been left to rot underwater is extensive and methane is a more potent global warming gas than CO2,” chartered environmentalist Saima Baig tells MIT Technology Review Pakistan.

Baig says a major post-covid lesson for Pakistan is to completely revert to cleaner energies. She maintains that investment in green technology, and development of renewable energy sources like wind, solar and wave, will also create jobs and help address the country’s power, economic and climate problems.

An Institute of Energy Economics and Financial Analysis (IEEFA) study released in collaboration with the Alliance for Climate Justice and Clean Energy, underlined the existing flaws in Pakistan’s long-term power generation capacity plan. These include ‘overly optimistic growth forecast’ for demand, expensive power, and prioritization of coal.

According to the study the Integrated Generation Capacity Enhancement Plan-2047 [IGCEP-2047] hasn’t taken into account the aftereffects of covid-19. Energy experts are worried that similar disregard for the environmental impact, laid bare by covid-19 lockdowns, could be disastrous in the long run for Pakistan.

In this regard, experts urge a focus on the 1,000km coastline wave energy, desert areas, solar energy and wind farms. Nuclear energy could be an important part of the mix, especially with proper disposal of waste. They further emphasize all policies to be implemented in accordance with energy and environmental considerations.

“Houses in urban areas—especially those in affluent areas with high energy use—must be constructed with energy efficiency in mind, and owners should be provided with financial incentives. Infrastructure, financial, subsidy, tax strategies, policies and legislation need to be looked into,” Baig urges.

For many, the ideal energy mix for Pakistan is one that does not produce greenhouse gases, worsen air pollution or burden the exchequer with the import of coal and petroleum products. Climate activists urge that given the scale of the climate crisis, they would have to supersede economic challenges.

“There will be no economy to challenge if temperatures continue to rise due to incessant global greenhouse gas emissions,” maintains Ahmad Rafay Alam.


Kunwar Khuldune Shahid is a journalist based in Lahore.

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