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Solar power plants updates


Mar 21, 2007
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Solar power in Pakistan

1000 MW Quaid e Azam Solar Power Plant.

In phase-I,.......
100 MW were commissioned in May 2015.
In phase-II,......300 MW were connected to the grid in June 2016
In phase-III,.....the working on 600 MW is already in process & is expected to be fully completed by the end of 2018.

The Quaid e Azam Solar Park is a photovoltaic power station under construction in Bahawalpur Punjab,named in the honor of Quaid e Azam Muhammad Ali Jinnah.Currently the transmission line has a capacity of up to 400 MW.
Pakistan’s first-ever solar generation project was formally inaugurated at the Quaid e Azam Solar Park on 5th May 2015.



The Quaid e Azam Solar Park

Chinese firm undertakes fourth phase of solar park

BAHAWALPUR: The construction and installation work of the fourth phase of 100 megawatt solar energy at the Quaid-i-Azam Solar Park (QASP) has been taken in hand by a Chinese firm.

This was stated at a meeting chaired by Divisional Commissioner Saqib Zafar here on Tuesday.

Additional Secretary Energy, Punjab Hussain Sardar informed the meeting that Chinese company Zorlu had taken in hand the construction work of the chief minister’s project of solar energy.

He said the staff of the company had reached here and the construction of the outer boundary wall had started for security.

The commissioner directed that the measures around the QASP be heightened for the security of staff and engineers.
SECMC, Reon to install Pakistan’s largest private sector solar power plant at Thar

KARACHI - With an aim to limit carbon emissions and thereby help protect the environment, Sindh Engro Coal Mining Company (SECMC) and Reon Energy Ltd have entered an agreement to install 5MWs solar power plant at Thar Coal Block II.This will be the largest solar energy project for captive utilisation to date, in Pakistan . The plant will provide considerable savings in energy-costs, along with an expected reduction of 3,150 metric tonnes in the annual carbon-emissions. SECMC will have the option to extend the contract during or after project completion, wherein Reon will operate it for the period of 15 years and then hand over the operations to SECMC , said an official release issued here.A signing ceremony was held at the premises of SECMC in Thar Coal Block II. ,
Abul Fazl Rizvi said, “The 5 MWs solar energy system will contribute benefits equivalent to planting of about 220,000 trees and will be the largest private solar PPA in the country.” “This is also the first-ever initiative by a mining company in Pakistan to install solar power plant for it mining operations,” he added.CEO of Reon Energy, Mujtaba Haider Khan stated: “Pakistan enjoys a geo-strategic advantage for producing abundant amounts of solar energy. Advancement in solar technology has not only improved solar’s efficiency but has also led to a massive reduction in costs. This is a landmark project that’ll significantly reduce the operating cost and carbon footprint.”
French agency likely to help install solar tube wells

ISLAMABAD: French Development Agency (AFD) would consider providing assistance to Pakistan in installing solar-powered tube wells in Balochistan and establishing a renewable energy institute under its development programme for the current calendar year, said the French envoy.

Meeting Federal Minister for Power Division Sardar Awais Ahmed Khan Leghari on Monday, Ambassador Marc Barety praised efforts of Pakistan’s government for bringing about improvement in the power sector.

He called the progress made in the power sector exemplary while disclosing that many French companies associated with the energy business were taking keen interest in Pakistan
There is a silent revolution going on in Pakistan: the rooftop solar energy revolution.

As per official import numbers, Pakistan imported more than 950 megawatts (MW) of solar power capacity in the last financial year, more than in the last four years combined.

Since the contribution of solar energy to the grid is still scaling up, the bulk of the imported solar panels have been installed on rooftops. If the trend continues, the country might add up to 5,000MW of rooftop solar panels by 2022 — a no mean achievement.

The chief reason for this sudden increase in solar rooftop installation is the extraordinarily poor performance of power distribution companies (Discos) coupled with a drastic reduction in solar panel prices. With the country still suffering blackouts of six hours or more a day, rooftop solar power now provides a viable solution to become entirely independent of the national grid to both urban and semi-urban consumers.

The drop in prices is another reason: five years ago, the cost of the same rooftop solar was five times more than what it is today. Plus, the marginal efficiencies of solar panels have also improved, so that more output can now be generated thus reducing costs per unit.

A positive role has also been played by the government, which is now pushing for more solar energy with friendlier net metering rules and improved regulatory regime.

The connection and regulatory approvals for net metering previously required six months to complete but now only takes a maximum of one month — giving solar installers more agility to close in on new connections and save time and operational costs.

Today, it is estimated that most of the growth in the rooftop segment is driven by commercial and industrial users, largely because the economics has started favouring them.

For instance, if a mall purchases power from the grid at Rs12-14 per unit for its consumption which is spread over 24 hours, a solar rooftop solution can instantly cut the net tariff in half — thereby helping them to hedge a long-term power tariff.

There is another advantage for industrial and commercial consumers with solar power — the energy is available when they need it the most — during daytime — which results in significant cost savings for their operations.

Besides the above-mentioned consumers, educational institutes such as colleges and universities could come in next as potential players in the market. Think of these institutions which have expansive, flat-topped buildings and large campuses ideal for installing solar panels.

Some of the far flung, public and private schools, colleges and universities are not connected to the grid or experience intermittent power and for them, this is an ideal time to install solar panels.

Urban educational institutes obviously come with a net metering advantage and have become excellent candidates for rooftop solar plants. Many of these institutions have acres of roofs, but assuming conservatively that only 200 kW of solar gets installed on average on these premises, there is scope for additional installation of 5,000MW across the country.

The problem up till now was understandable. You put up a solar plant on the roof of a university for self-consumption of power, but what will they do with the electricity produced on holidays, or during summer or winter vacations?

Previously, zero gain on weekends and two to three months of summer vacations would make solar economics go for a toss. Not anymore. Net metering provides an ideal opportunity to sell power back to the grid in summer and over the weekends and supplying to the grid at a tariff of Rs10-12 per unit.

What once did not make any commercial sense is now solely lucrative on economic grounds.

With rooftop solar dominating, net metering has become even more critical today and is sprouting different business models such as the ‘opex model’ where the roof owner does not own the solar plant. The solar is owned by a third party who invests in the plant and sells power, typically, to the roof owner.

Since the rooftop solar plant owner is a power company and there is an incentive to sell electricity back to the grid through net metering, every unit of electricity generation matters. The roof owner is happy because he gets a fixed long-term tariff without undertaking any upfront investments — and hedges himself against rising power tariffs (think of all the surcharges).

The third-party owner of the solar panel is happy because his internal rate of return (IRR) of selling the power back to the grid and opex revenues from his customer is higher than his cost of capital. And last, the government is happy because the grid is now more stable owing to all the excess power being supplied to surrounding neighbourhoods instead of burning additional electricity.

As always, there are certain challenges. Pakistan’s power distribution companies aren’t keen on promoting rooftop solar power as that could hurt their finances.

All Pakistani Discos are owned by the government and have net accumulated losses on their balance sheets. With circular debt adding up their liquidity woes, they might see net metering as a potential threat where good paying consumers leave them for independent generation.

There are technological challenges, too, but they could be easily overcome. For instance, not many Discos have the technical capability to adjust to power fluctuations. During the day, there’ll be adjustments to accommodate sudden spikes of generation; in the evenings, there’ll be a reverse flow which makes the power variability and intermittency come in a much larger way.

There is another concern of the government’s stranded costs of assets that it has procured on stringent ‘take or pay’ terms.

With another 20,000MW due to come on line in the next three years, the government might fear the silent net metering revolution can make existing assets redundant in the long run. This can happen if consumers choose to opt out of the national grid and join the greener club, which will make the existing tariffs even steeper for consumers who are paying for the grid in the first place.

But even when stranded costs are high, this revolution must never be thwarted and stopped. Fortunately, the government has shown a long-term vision and far sightedness by simplifying net metering rules and encouraging Discos to adapt to the changing times.

1.4 MW Rooftop Solar at Nishat Emporium

  • Client.............................:Nishat Emporium
  • Location.........................:Lahore
  • Installation Type.............:Rooftop
  • Total Capacity.................:1.4MW
  • Grid Connectivity............:Grid-Tied


KW Solar Solution at Supreme Feed Farms

  • Client........................:Supreme Feed Farms
  • Location.....................:Sheikhupura
  • Installation Type..........:Rooftop
  • Total Capacity.............:700KW
  • Grid Connectivity.........:Yes
Solar power

Making the most of sunshine


Imagine taking a financial position where you have to bet on the rupee devaluing against the dollar, increasing oil prices and inefficiency of the government. This is precisely the position a solar rooftop customer in Pakistan finds himself taking these days.

Consider the loaded grid tariffs (including taxes, surcharges, fuel price adjustment) of a residential connection in the Lahore Electric Supply Company (Lesco) system. The loaded peak tariff went from Rs24.51 per unit in July 2018 to Rs31.09 per unit in March 2019, depicting a 27 per cent increase over eight months.

Moreover, this increase was about 130pc when compared to the loaded peak tariff in March 2018. Much of this increase has been on account of fuel price adjustment (a function of dollar rate, imported oil price and energy mix) but also because effective 1st January 2019, the base tariff was revised upwards by around 50pc.

Coming summers, with further currency devaluation and higher imported-fuel based power generation expected, the tariffs will rise further.

And yet all of this actually helps a solar customer because he remains immune to such tariff escalation. Moreover, thanks to net or reverse metering (where he can sell excess electricity back to the grid) he can actually earn from such inflation in grid tariffs. This disruption is here courtesy solar technology.

Solar technology, much like perhaps all the technologies, has gone through rapid and exponential changes. The price of a solar photovoltaic (PV) panel has gone down from $76.7 per watt in 1977 to about $0.20 per watt today.

This is a phenomenon explained by Swanson’s Law that states that price of solar PV cells tends to drop 20pc with every doubling of cumulative shipped volumes. This learning curve of solar manufacturing has only made solar PVs more affordable.

As opposed to grid-scale solar plants, rooftop solar systems save approximately 15-20pc in transmission/distribution losses

Pakistan is blessed with high solar irradiance (solar power per unit of area) and ample rooftop space. Solar rooftop customers here today enjoy a much better payback on their investment than they did a few years back.

Between 2014 and 2018, the fall in present value prices in dollar terms was considerably higher than rupee devaluation against the importing currency. These factors, coupled with galloping tariff rates, can make an investment in rooftop solar payback within 5years.

That being said, solar energy, much like all renewables, is inherently intermittent. You just can’t have solar power at night. This intermittence makes it both expensive and unreliable for grids’ base loads.

In case of solar, this causes another problem to grid managers called the Duck Curve. Duck Curve is the graphical representation of power production over the course of a day that shows the timing mismatch of consumption and solar power generation.

Typically for grids, power consumption increases early morning for a brief period, experiences a trough during day time then peaks again in evening hours before going down during night.

Now with solar power in the mix, the solar production peaks mid-day which makes the day time trough of grid load more pronounced leaving grid managers with excess power supply in day time and a deficit (requiring expensive peaker thermal plants to operate) in the evening.

The most effective solution to this generation-consumption mismatch lies in energy storage. An efficient, reliable and cheap energy storage system remains elusive and forms the weakest link in the whole solar chain.

This, however, changed recently. In March 2017, the island of Kauai in Hawaii got a 52MWh battery storage solution from Tesla installed at its existing 13mega watt peak (MWp) solar farm. Serving about 30,000 customers on this remote island, the batteries will be replacing diesel-fired generators during night time that would reduce the use of fossil fuels by 1.6 million gallons per annum. And all of this at a unit cost one-third of diesel-powered electricity.

Tesla used the lithium-ion battery technology for this solution. The lithium-ion (li-ion) technology not only boasts grid-scale application but has also brought in residential/commercial consumption to its fold.

The manufacturing of lithium-ion batteries has seen explosive growth since 2010. Driven earlier by consumer electronics (smartphones, laptops, tablets etc), the automotive sector (electric vehicles) is now the dominant user of li-ion based energy storage technologies.

Similarly, given its distinct advantages over traditional batteries, li-ion has become the battery technology of choice in stationary storage solutions (like PV and grid storage) as well. Compared to conventional lead-acid batteries, the lithium-ion batteries have up to 80pc higher usable capacity, up to 70pc better efficiency (lower energy losses), 2-4 times higher energy density (energy stored per kilogram), and 4-5 times longer cycle life.

Lastly, thanks to large manufacturing capacities, the battery cell prices have seen a steep decline — 19pc per annum between 2010 and 2016 – making them reasonably affordable. Therefore, for solar PV systems requiring storage at home or in offices, li-ion batteries have become really a no brainer.

The suitability of distributed solar for Pakistan’s energy mix is hard to overstate. Solar power is good for lungs, it causes our carbon footprint to shrink, offsets our future import of fossil fuels, conserves valuable foreign exchange and has the lowest dollar cost per unit of energy today.

Moreover, as opposed to grid-scale solar PV plants, roof-top solar systems generate power where it is consumed, saving approximately 15-20pc in transmission/distribution losses. And they require no sovereign guarantees from the government either.

And yet, despite all the good intentions and efforts by the government, as evident by various incentives offered for solar adoption, the offtake has been quite slow.

Major reasons for these include a general aversion of our people to adopt new technology, bad experience with cheaper/poor quality systems offered by unreliable vendors and, most importantly, lack of financing options for solar customers to make the high upfront investment.

Therefore, in order to truly harness solar potential on rooftops, government will have to push banks for solar consumer financing and streamline existing power distribution infrastructure. Until that happens, only a fortunate few will stand to benefit from this technological disruption called rooftop solar.

The writer heads the business advisory function at a large industrial and services group in Islamabad

Published in Dawn, The Business and Finance Weekly, May 6th, 2019

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ISLAMABAD: A couple of weeks ago, we discussed in this space, the issue of spot vs long-term liquefied natural gas (LNG) contracts. In the following, we will highlight the emerging international LNG market.

Global LNG trade grew 6.4% in 2018 value at $150 billion. The market is getting competitive. There are already 20 countries supplying LNG which included Qatar, Australia, Malaysia, Russia, the US, Nigeria, Indonesia, Algeria, Egypt, and others.

A lot of capital expenditure is coming. Saudi Arabia is a new entrant while Oman and the UAE are already in the market, apart from Qatar. LNG prices have shown some volatility in recent years – these were at $15-20 per million British thermal units (MMBtu) in 2014, came down to $5 in 2017, rose to $10 in 2018 and are now trading around $5, both in Asia as well as Europe. The normal ratio between LNG and crude oil prices has traditionally been 80% and predictions are being made that the ratio may go down to 50% due to an LNG supply glut.
It appears that term contracts are risky although spot purchases have non-price risks. According to the IGU Report, out of global LNG trade of 316 million tons per annum (MTPA) in 2018, only 99 MTPA was contracted as non-term (32% of the total).

LNG suppliers prefer to have long-term oil-indexed contracts of 20-25 years, seeking price stability and visibility to ensure required investments. However, LNG spots are better indicators of supply and demand and this trend has been growing constantly.

Gas-linked contracts are originating from the US where LNG contracts are linked with the Henry Hub Index (HHI). Normal terms are 1.15 times of Henry Hub price plus liquefaction and transportation costs.

India’s 60% of supplies are coming under oil-linked contracts and 40% is based on gas-linked contracts, the latter coming mainly from the US. As China has superseded Japan as the largest LNG importer, Australia has superseded Qatar as the largest LNG exporter. It is being predicted that in a few years the US would become the largest LNG exporter due to being the lowest cost producer because of its cheapest shale resources.

Australia has been offering more flexible contracts while Qatar has stuck to the earlier day’s restrictive practices such as destination restrictions. Qatar Gas companies are reportedly under investigation by European regulators for their restrictive practices contrary to the cardinal principles of open competition.


Pakistan has three-term contracts with Rasgas of Qatar, Gunvor of Switzerland and Eni of Italy. The contract with Rasgas was a negotiated contract which sparked a lot of controversies. The government of the time claimed that its Qatar contract terms and prices were compatible with Qatar contracts with India and Bangladesh, which was demonstrably correct.

Later, two other LNG contracts were signed with Eni and Gunvor as a result of open bidding at quite reduced prices of 12.29% and 11.6427% of Brent crude (of the average of last three months) respectively.

These low prices caused further controversy. LNG was also procured in spot markets with a slope varying between 9.2% and 16%. At current crude oil prices of $70 per barrel, Pakistan-Qatar term contract prices at the 13.37% slope would come out to be $9.35, Eni at $8.82 (12.3%) and Gunvor at $8 (11.6427%). However, spot prices rise in winter, but these are not expected to rise by 100%.

Most countries renegotiated LNG term contracts in 2015 and it appears that another round of renegotiations is around the corner. The Pakistan Tehreek-e-Insaf (PTI) government has requested, if not demanded, price revision from Qatar in the wake of much lower market prices offered and contracted for with Eni and Gunvor.

According to the contract terms with Qatar, price openers can be done after 10 years. Pakistan wants it after five years, if not an outright revision shortly. However, increased supplies of 200 mmcfd have been agreed to recently by Qatar at 20% lesser prices along with some better credit terms.
Pakistan Army to Generate Electricity for its Establishments

Pakistan Army is all set to generate electricity for its garrisons and establishments across the country to cut their expenditure on power which is estimated to be around Rs 15 billion for 240 MW.

According to the reports, the Pakistan Army is planning on harnessing renewable energy through solar parks. With an aim to establish 1-5MW solar parks in each garrison, the pilot project will generate 40MW energy and no public money will be used on solar parks for 25 years
The Naveena Group has announced that it has achieved Financial close with the Government of Pakistan for its 50 MW Wind Power Project in Jhimpir, Thatta ,Sindh.

The project cost of USD 63.9 million will provide the cheapest electricity to the consumers at a price of just US cents 4.7154/kwh (Rs. 7.32) from a platform of clean and green energy. The project is scheduled to come online by the end of 2021
Sindh to auction solar power project

December 7, 2019

The 50MW project is part of the planned 400MW solar power park in Sindh that is estimated to attract investment of around $250 million. PHOTO: REUTERS
The 50MW project is part of the planned 400MW solar power park in Sindh that is estimated to attract investment of around $250 million. PHOTO: REUTERS

KARACHI: Pakistan is entering into a new era of attracting power projects through competitive bidding to provide cheaper electricity to end-consumers, as Sindh government is all set to auction the first-ever project through the bidding process by March 2020.

To date, the country has attracted power projects by offering incentives to investors under the cost-plus tariff formula, which ensured a fixed internal rate of return (IRR) to investors.

The achievement of surplus installed capacity of power production in recent times allowed authorities to make a shift towards new power projects through the tariff-based competitive bidding.
“We are set to auction the first 50-megawatt (MW) solar power project at Manjhand (district Jamshoro) through competitive bidding by February-March,” Sindh Solar Energy Project (SSEP) Project Director Mehfooz A Qazi told The Express Tribune on Friday.

President calls for switching to solar energy

The 50MW project is part of the planned 400MW solar power park in Sindh that is estimated to attract new investment of around $250 million. “We aim to auction all the potential 400MW solar power projects by 2021 and start supplying electricity to the national power grid within the next five years (2023-24)” he said.

The World Bank is providing financial and technical support for establishing the solar park. “Word Bank has provided an assistance of $100 million for four different solar power projects, including $30 million for establishing the 400MW solar park,” he said.

In this backdrop, the Energy Department of the government of Sindh appointed a consortium of foreign and local advisers to auction the 400MW power projects on Friday.

The consortium comprises Bridge Factor (Pakistan) and Tractebel Engie (Germany) in association with Renewable Resources Limited (Pakistan), Ashurst Law (Singapore) and Axis Law (Pakistan).

On behalf of the government of Sindh, Qasim inked the contract with the consortium to hire its services in the presence of Provincial Energy Minister Imtiaz Ahmed Shaikh at Energy Department.

The project director hoped the solar projects would attract an investment of around $250 million, considering the country has recently attracted $38 million investment for a 50MW solar project under the old formula of cost-plus tariff.

“We are highly hopeful the projects will provide cheaper and clean energy in the country,” he said.

Plan in hand to install four solar, hybrid power plants in Balochistan

Earlier, the National Electric Power Regulatory Authority (Nepra) had announced an upfront tariff of 5.23 cents per unit (Kilowatt per hour) to attract solar projects under the old formula of cost-plus tariff. “The competitive bidding will surely attain a comparatively cheaper tariff than the upfront tariff,” he said.

The competitive bidding process allows the Sindh government to accept the lowest tariff-bid from new potential investors. Later-on, it may ask other investors to match the lowest bid to become part of the 400MW solar park.

He said the investors would offer the much cheaper tariff than the upfront one, as cost of solar power projects has massively gone down over a period of time.

“The government awarded a (high) tariff of 15-16 cents per unit for the first solar park (Quaid-e-Azam Solar Park of 100 MW set up in Bahawalpur, Punjab) years back. The cost of solar power projects has further cut down since Nepra approved the upfront tariff of 5.23 cents per unit for solar power,” he said.

Solar remains one of the low-cost sources of electricity generation in the energy mix in the country. More importantly, the federal government has planned to increase the share of solar power to around 25% by 2025 compared to around 4-5% at present.

Qazi said the demand for electricity has been increasing by 5-7% per year. “The surge in demand may come comparatively higher and quicker considering the country is set to see acceleration in economic growth going forward.”

The surplus in the installed power production capacity became possible under the multibillion dollar power projects set up under China-Pakistan Economic Corridor (CPEC) in recent years. The power transmission and distribution network is, however, yet to be improved to end hours-long power outages in the country.

Published in The Express Tribune, December 7th, 2019.
Licence sought for 100MW solar plant

Solution De Energy has approached National Electric Power Regulatory Authority (NEPRA) to seek generation license for a 100 MW solar power facility to be setup in Bhawalnagar, Punjab at an estimated cost of $90.26 million.

Crescent Steel and MdeCC had signed an agreement to establish a solar power project, for which a special purpose vehicle Solution De Energy was formed. The project involves some of the leading companies both locally and abroad. Crescent Steel and Allied products and MdeCC are experienced in the energy sector in Pakistan. The technology, management and funding partner Total Eren from France has extensive experience in renewable energy projects in Europe and Asia. The project developer and co-sponsor MdeCC was a founding partner and member of the Ivy Company and Goldman Consortium

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