Mushtaq Ghumman
February 10, 2024
ISLAMABAD: The Executive Committee of the Special Investment Facilitation Council (SIFC) has directed the Private Power and Infrastructure Board (PPIB) to conduct competitive bidding process for 300 MW out of category–III wind projects within a week, well-informed sources told Business Recorder.
However, category-III solar projects will be considered after finalization of Indicative Generation Capacity Expansion Plan (IGCEP) and Transmission System Expansion Plan (TSEP).
The previous government headed by Prime Minister Mian Shahbaz Sharif had approved 13 advanced stage category-III wind and solar projects.
Recently, Pakistan Foreign Renewable Energy Investors Forum, in a letter to Chief of Army Staff, saying that PPIB, and Power Division has made efforts in inviting investments, as evidenced by the solicitation of the Muzaffargarh 600 MW solar project. However, despite these efforts, the bidding processes in May 2023 and September 2023 did not yield the expected results.
Pakistan is to have fuel-free electricity at cents 5/kWh from wind and solar projects which will bring down “basket prices” as currently basket price is cents 10-12/KWh with use of imported LNG and coal.
Since 2017, in Pakistan no new wind or grid solar projects have been sanctioned, whereas, India and China have made significant strides in these sectors by adding hundreds and thousands of MWs of wind and solar projects.
“If 10,000 MW of wind and solar projects are installed in Pakistan, we can save foreign exchange of $2-3 billion per annum in fuel-import bills (LNG, imported coal),” said Mustafa Abdulla in his letter to the COAS.
The ARE-2006 policy was a significant step forward, aimed to establish 1,700 MW of wind and solar power from 2017 onwards. However, its discontinuation in 2017 was a setback.
The subsequent ARE- Policy 2019, despite its merits, has posed challenges in fostering future wind and solar projects, as seen in the outcomes of PPIB’s recent bidding attempts.
The NEPRA had approved tariffs for thirteen wind and solar projects between January and August 2020. These projects, having completed various procedural requirements, are awaiting further advancement.
These projects represent a substantial opportunity, with $600 million in guaranteed investments and the potential to add significant capacity to the country’s grid at competitive rates. Their approval aligns with the objective of reducing fuel import costs and addressing load shedding issues, particularly in Sindh.
“I don’t understand what is harm to the policymakers, if cheap electricity is made available to the consumers,” said Mustafa Abdulla.
The sources said EC of SIFC has also directed Power Division to holistically review the resolution of issues of all 47 Letter of Intent (LoI) holders However, three projects sponsored by Foreign/Korean investors - KalamAsrit 238 MW AsritKadam 229 MW and Lower Spat Gah 470MW- are to be considered separately.
