Photo Credit: PakObserver

IEEFA has recommended a more diversified energy mix with increased reliance on renewable energy sources, saying this would also benefit the country’s economy

A report published by the Institute for Energy Economics and Financial Analysis (IEEFA) on Wednesday has warned that Pakistan’s current power mix is over reliant on outdated fossil fuels and seasonal hydropower generation. Titled Pakistan’s Power Future: Renewable Energy Provides a More Diverse, Secure and Cost-Effective Alternative, it asserts that renewable energy sources like wind and solar are now the most cost-effective form of power generation in Pakistan and postulates an energy mix for the year 2030 that is 30 percent renewable, 30 percent thermal, 30 percent hydropower and 10 percent nuclear. Currently however, the energy mix is 70 percent thermal and 20 percent hydropower, with nuclear power accounting for most of the rest.

“The current energy model puts a huge cost burden on consumers, businesses and the cash-poor government of Pakistan through an over-reliance on expensive fossil fuel imports and costly hydro, nuclear and coal-fired power plants often being built well over budget,” points out IEEFA financial analyst and co-author of the report Simon Nicholas.

Read more: Study: large hydropower dams unsustainable

“By relying more on cheaper renewable energy, the 2030 model reduces the cost pressures of imports and delayed projects, creating the setting for government to attract investment in the abundant domestic wind and solar resources yet to be harnessed,” he adds.

The report laments that despite the fact that the Pakistani currency continues to weaken, the country pushes ahead with power plants reliant on fossil fuel imports. Not only would this add to Pakistan’s economic woes, it also does not bode well for the country’s energy security. It adds that such a model is even more redundant now that tariffs for wind and solar are below those on other energy sources.

Pointing out a third advantage, the IEEFA report says renewables also have faster construction times. Large hydro power projects are notorious for running over schedule and over budget, which only adds to their already very large costs. Nuclear power projects increasingly suffer large cost and time overruns around the world. Regardless, Islamabad continues to plan and build up nuclear and hydropower units at a time when both these forms of energy are being abandoned around the world.

“With renewable technology set to get cheaper in the future, a build-out of coal-fired power risks locking Pakistan into decades of outdated technology,” the report concluded.