Pakistan’s Solar Policy Shift: A Challenge for Power Division

The changing solar power policy of the Government of Pakistan has put the Power Division in a tough spot. At first, the government was promoting the installation of solar panels to reduce dependence on expensive electricity but now solar solutions are becoming popular. This can cause problems for conventional power companies and low-income people may not be able to afford electricity.

Solar Power Surge and Capacity Charges

Pakistan has seen a large increase in solar power adoption, as per the current estimates nearly 6,000 megawatts of solar energy can be connected to the national grid out of which nearly 3,000 megawatts of solar capacity is already installed. This increase in solar energy generation also put the financial stability of private power companies into question as they are not generating continuous electricity from their power plants and getting decline in capacity charges.

Impact on Electricity Costs and Affordability

The drop in buying price of electricity from 11.50-22 rupees per unit to a fixed 11.50 rupees by the government has discouraged investments in solar solutions on top of addressing these problems, which could have a major negative impact on the affordability of electricity for low-income people because if they can’t afford the high upfront cost of solar panel installations then they will have to continue using grid electricity, which could potentially be more expensive as compared to solar energy.