The government of Pakistan has announced that it will invite bids for setting up renewable energy projects in the country in a bid to tap the investment potential of $40bn.
In the new renewable policy, the government will abolish upfront tariff and replace it with competitive bidding to attract investors to enhance the share of renewable energy to 30% in the energy mix.
Speaking at a press conference, Federal Energy Minister Omar Ayub Khan unveiled the Alternative Energy Development Policy 2019, stressing that the country had potential for $40bn worth of investment in renewable energy.
“The government is eyeing 30% renewable energy in the system by 2030 and together with hydroelectric power it will be 60-65% of the energy mix,” the minister said while announcing the revised renewable energy policy.
He was of the view that the previous government had introduced expensive re-gasified liquefied natural gas (RLNG)-based electricity, which was costing around Rs17.5 per unit and multiplied the circular debt.
“Investment has already started pouring in as the government has signed renewable energy agreements with 12 companies, which will bring $700mn worth of capital,” he said.
The minister revealed that besides generating renewable energy, the investors were also interested in the manufacturing of solar panels and wind turbines in Pakistan. “Danish, Chinese and Japanese companies have expressed interest in the manufacturing of wind and solar equipment in Pakistan.”
He reiterated that 80% of electricity feeders were free from load-shedding in the country as with the help of various measures additional revenue of Rs229bn had been generated.
Talking about salient features of the renewable energy policy, Special Assistant to the Prime Minister on Petroleum Nadeem Babar said the upfront tariff had been abolished and now all future tariffs would be based on competitive bidding.
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