ISLAMABAD, MAR 31 – Chairman NEPRA, Tauseef H. Farooqui, has said that the government is eying to increase Hydropower projects, under the umbrella of Renewable Energy in the to 30% from current 3-5% under the umbrella of Renewable Energy (RE). Therefore, the target is increasing the share of renewable energy in the country to 60% in the next 10 years. He said this while sharing his view with the participants of webinar ‘Impact of COVID on Energy Sector of Pakistan: Opportunities and Challenges,’ held by Sustainable Development Policy Institute (SDPI) here on Wednesday.
While highlighting the impacts of Covid-19 on the sector, he informed the participants that the pandemic has affected investment in the energy sector globally from 20-30% and in Renewable Energy sector by 15%. He added further that there have been several challenges on the demand side as commercial activities were ceased for a while leaving a bad impact on the country economy. Therefore, the government provided 25% discount to industrial sector SMEs was provided with 50% relief.
Ms Anne Sackville-West, Economic Officer US Embassy, Islamabad, informed the participants thatthe United States and Pakistan have been working on Renewable Energy for the last many years. Besides, USAID has recently made investment in several clean energy projects within the country. In the context of Pakistan, she said, the structural changes are expected in tariff and thus, the energy would be getting expensive in coming days.
She added further that the price of the electricity would ensure that Pakistan moves out of the current situation regarding circular debts. However, on other hand, a lot of people are still not having access to electricity. It signifies the need of having an holistic approach and a broader stakeholder’s engagement to resolve several technical and policy level issues including the affordability and sustainability of the energy. Financial incentives are the key for market to come up with appropriate solutions. Therefore, Long term integrated conversation approach is required, she added.
Mr Khurram Lalani, the expert in energy sector, was of view that a key learning from Covid-19 is that the scientific economic diversity should be accepted in policy making process. In energy sector, he said, the grid modernization framework is lacking in Pakistan. The subsidy retargeting regime need to be addressed as majority was not able to pay bill in the times of pandemic, he added.
He highlighted that that the investors loose out hope when it comes to tariff. Thus, the competitive market regime is required. Besides, good financing as well as technical base is the required for a clean, stable regime. The Covid-19 has provided with an opportunity to reassess and come up with a comprehensive framework with reference to the fuel pricing, mitigating cost.
General Manager Engro Energy Limited, Dr. Fatima Khushnud, highlighted that slow economic activity was observed after Covid-19 occurrence. It is a positive sign however that the supplier regulation is out for the consultation process and we are moving effectively on the policy side. Therefore, a lot of market reforms are expected because of the impacts of pandemic.
She opined that many industries were now aware of the Renewable Energy, especially in the textile industry and steel industry and it is also moving towards green energy for a better financing. She added further that we need to move towards electrification of the transport sector and better financing opportunities exist if we are inclined towards green energy.
Dr Sajjad Amin, Research Fellow SPDI, earlier highlighted the importance of fiscal stimulus and said that we need to explore possible actions as fiscal stimulus is not aligned with green recovery. He said that the demand for green energy needs to be explored. Dr Hina Aslam of SDPI also highlighted various aspects of the topic, especially in the context of Pakistan’s transition towards the green energy.