“Chinese investors play a pivotal role in supporting Pakistan in its journey to privatise distribution and modernise transmission,” said Tauseef H. Farooqi, Chairman of National Electric Power Regulatory Authority (NEPRA). Addressing a webinar on accelerating Chinese investment in the renewable energy market in Pakistan, the chairman pointed out that renewable energy is an inexhaustible source of green energy and the most cost-effective option in the current economic crisis in Pakistan. According to a Gwadar Pro’s report, Chinese investors are welcome to explore the infinite possibilities of various renewable energy sectors in Pakistan, including hydro, thermal, solar, etc.
Pakistan is a country with an enviable advantage in renewable energy. In the case of solar energy, Pakistan alone has almost 1,900,000 megawatts of solar potential. Starting from 2023, Pakistan will conduct the first round of competitive bidding for the upcoming Solar Fast Track program, which seeks to induct 10,000 MW of solar power. Chinese investment in Renewable Energy (RE) can provide a significant boost in Pakistan’s efforts of transition to a low-carbon energy mix.
According to the International Energy Agency (IEA), China has been the largest global investor in RE, with a total investment of $758 billion from 2010 to mid 2019. China’s RE industry is among the global leaders, especially in wind and solar PV, providing about 5 million jobs across the globe. China-Pakistan Economic Corridor has contributed generously to Pakistan’s power sector with more than 20 projects close to 10,000 megawatts, an investment of more than $20 billion, the chairman noted.
To attract Chinese investment in RE in Pakistan, the country is seeking solutions to address the current barriers and provide clear and stable policies, access to financing, and adequate infrastructure. As one of the first countries in the region to adopt the IPP model in project engineering, Pakistan has accumulated ample experience in cooperation with Chinese investors. Pakistan is establishing scientific planning policies in its capacity expansion, and it will be a demand-driven, supply-based system.
The chairman added that NEPRA was taking steps to bolster private sector investment, such as opening wholesale markets in Pakistan where anyone interested in buying and selling more than 1MW of electricity could sign bilateral contracts and get registered. “Pakistan is trying to change the way its power industry works and modernize all of its transmission infrastructure, a process that will require more involvement from Chinese investors.” he added.