In order to understand the importance of Industrial Solar Installation in Pakistan, one must first know a little bit about the renewable energy sector in this country. Despite the high demand for renewable energy, many people are still hesitant to switch to solar power. Listed below are some of the factors that may deter investors. However, once an understanding of the benefits of Industrial Solar Installation is gained, it will be possible to take steps towards making the country a better place to live in.
High demand for solar energy
The rising cost of fossil fuels and rising costs of electricity have made industrial solar energy in Pakistan a good choice for many industries. The cost of installing industrial solar systems in Pakistan is not prohibitively expensive and the benefits are multiple. While the typical residential connection in Pakistan is three to seven kW, many industrial facilities use more than one megawatt of energy, and the cost of PV installations in Pakistan is significantly lower. However, the current power system structure in Pakistan does not support PV prosumers. The country is also facing a fundamental challenge in developing a regulatory framework that supports the use of renewable energy.
According to data compiled by the German Agency for Development Cooperation, as of December 2021, there were about 18,000 distributed generators in Pakistan. However, more than 15,000 were issued in 2020 and 2021. This is less than half the amount of solar capacity that is actually in use today. Furthermore, the number of unauthorized companies is twice as high as the number of authorized companies, raising questions about the security of the electrical infrastructure.
FIT policy
The FIT policy for industrial solar installation in Pakistan is a key aspect for establishing a solar power generating project in the country. While the FIT for solar projects in Pakistan is currently very high, it will decrease over the coming years. The first step in the tariff development process is to obtain a Letter of Intent from the AEDB and provincial agencies. If a developer meets the eligibility criteria and is approved,
Under the FIT policy, producers can sell surplus solar electricity to the grid and get compensated above the retail rate. The FIT is a type of net metering, which pays producers for the excess electricity they produce. In Pakistan, the FIT does not apply to residential solar panels, but to larger renewable power systems. As a result, on-grid power is cheaper and does not require batteries. The FIT policy in Pakistan is also limited by continuous load shedding, which prevents solar systems from working during periods when the grid is down.
Barriers to growth
The paper aims to address the obstacles to RE development in Pakistan and identify the underlying factors and barriers that affect RE development. This study has categorized the barriers into four categories: social, environmental, technical, and legal. The social dimension includes financial status of households, lack of energy literacy, and public policy, and the technical dimension addresses the need for skilled labour and inefficient power distribution infrastructure. The report also identifies the challenges that can be addressed with targeted policy interventions.
Energy experts in Pakistan have identified several challenges that can hinder the growth of solar power in the country. One of these is the difficulty in locating space for solar farms, which can take a long time to complete. Secondly, construction approvals can be delayed. Another obstacle is the initial cost of the technology, which is prohibitively high. But if the costs of solar power are lowered, the country can potentially benefit from a more diverse energy portfolio.
Applications of solar thermal
While the solar water heater technology has been successfully applied in many countries, it is still underutilized in Pakistan. Some major hurdles to the adoption of this technology include public awareness, insufficient policies and initial costs. It is crucial to measure the expected financial returns, social benefits and induced environmental benefits of the technology before proceeding with the implementation of the system. This study focuses on Pakistan and provides practical guidelines for industrial enterprises to adopt solar thermal energy.
The solar dish technology is also feasible for small scale installations in Pakistan. The country has ample solar potential for this technology and can be implemented at any location, even in remote areas. In addition, areas like Sindh and Baluchistan have suitable conditions for installation of solar dish technology. Moreover, a few cities in Pakistan, such as Jacobabad, have sufficient sun radiation to support the installation of solar thermal power plants. This technology is considered economically viable if it is compared to fossil fuel-based electricity.
Energy storage
In recent years, Pakistan has witnessed a growing demand for renewable energy. Consequently, the government has been struggling to meet that demand. The government's centralized local electricity value chain has also kept consumers reliant on the government for their energy needs. Nevertheless, solar energy is changing this dependence. It has established itself as a cheap source of energy and is fast becoming a leading choice for industrial and household consumers alike. Higher penetration will have far-reaching impacts on the power system of Pakistan.
Renewable energy in Pakistan has many benefits, and the country's recent legislation has laid the foundation for such developments. The state's recently revised its RE finance scheme, lowering the interest rate on RE from 12.5 percent to 6 percent. In June 2016, the State Bank of Pakistan (SBP) recognized different consumer categories and reduced the RE finance scheme's interest rate from 15 percent to six percent. In addition, the government is establishing the Industrial Renewable Energy Development Fund (IRDF), which will finance industrial solar installations and other renewable energy projects.
