World Bank says Pakistan must call for 11GW renewable energy bids

Variable Renewable Energy Competitive Bidding Study – a new study by the World Bank – has said that Pakistan will require a call for competitive bidding for over 11 GW of renewable energy solar and wind power plants between the present and 2028. The study stated that this is needed to ensure that the future RE procurement stays strategic, transparent and economic. Also, early action will be critical to build the capacity of the relevant procuring authorities.

The World Bank study also found that in Pakistan there is no competitive bidding yet and this has delayed the expected low cost power benefits to power consumers. The delay has further delayed Pakistan’s transition to a more secure, sustainable and affordable electricity sector.

Until September, 2021, Pakistan has added just 1,700 MW of solar and wind energy. It has a national target of 12,900 MW of solar and wind energy by the end of this decade. This implies, Pakistan has now to add 11,200 MW in the coming eight years. However, this is even as the country has failed to add any utility scale solar pipeline in the past 3 years.

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The study also mentioned that now a phased approach can help Pakistan to reach its RE addition target. This is based on the volume of capacity outlined and the rate of past development as just 1.7GW is added in about 8 years of time.

World Bank research says that phased approach will lead to immediate fuel savings and see that Pakistan doesn’t experience any power supply deficit in the middle of this decade. The World Bank had recently held that the ‘least-cost’ generation mix in Pakistan requires at least 20 GW of solar and wind energy addition by the end of this decade. When some reductions are accordingly supposing lower demand, then also 11 GW of additional solar and wind energy should be added by 2028.

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Pakistan has one of the highest solar irradiance on the planet for solar power development but the country is still moving at snail’s speed as far as RE addition is concerned. Political instability and lack of will in the political executive is one of the key reasons that barely 1% of Pakistan’s electricity comes from solar power plants. A slew of Chinese built coal power plants with guaranteed returns and contracts has further reduced space for renewable energy, even as the sharply lower costs today as compared to say, 2013.

Hydropower lobbies also work against the solar installation additions. Unattractive tariffs, procedural delays and complexities in finding suitable land are other reasons. Some think tanks in Pakistan believe that initial costs of solar power installations are very high and the space it requires eats up the agricultural lands.

Regions with enough space like Baluchistan province are not as well connected to the transmission grid, adding to potential costs.