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A Common Sense, Viable and Green Solution for Power Shortage in Pakistan

I arrived in Pakistan the morning of April 29th to attend to a pressing family matter. With day time temperature as high as 38 C throughout my stay so far, we are having over 8-10 hours of power-outage everyday. Interestingly enough on the same day I arrived, Dawn published this news story Power shortfall exceeds 6,000MW .  In past several years and several successive governments there have been many broken promises when it comes to ending this power shortage in the country and no serious solution has been presented to solve this problem in the short or the long term, even political leadership is revising their estimates and calculations and finding justifications for breaking their election promises last year.

In my personal capacity I have been researching sustainable and mass scale solutions to solve this pressing problem which is not only impacting the quality of life for hundreds of millions of citizens, but is also hampering growth and economic activity in the country, which is already at rock bottom due to prolonged political and social instability and worsening security situation. I am in agreement that there is a lot which needs fixing in this country we call our home, but this power crises affects everything including maintaining law and ensuring security.

Based on the figures quoted in the Dawn article which I referenced above, the power shortage in the country runs anywhere between 2500 MW to over 6000 MW a day, which translates to 15%-35% of the estimated demand of 13000-17000 MW, a huge gap to fill. There have been talks, often politically charged, of creating new hydro electric projects, nuclear and thermal power plants, which all require huge financial commitments running into 10s if not 100s of billions of dollars, with completion several years in the future and no immediate relief in sight.

With the intensity of heat in majority of the country in summer and the number of sunny days we get throughout the years, it is such a shame that we haven’t given solar energy as serious of a thought as it deserves as a common sense, viable and sustainable solution. With the cost of solar panels dropping considerably in recent years, based on my initial inquiries in the local retail market a solar panel costs about PKR 100 – 110 per Watt, so a 1 kW array of Solar panels in Pakistan costs about 100-110,000, with transportation/labor/installation cost included the total can run anywhere between PKR 125-150,000($1250-$1500). A typical decent quality solar panel has a life of about 25 years, with roughly 3000 sunny hours in an year such an array of solar panels can produce 3000 kW-h in an year and 750,000 kW-h in its lifetime. With a setup like this we can get power for PKR 0.2/kW-h.

Based on 2010 figures for per capita electricity consumption available on World Bank website for Pakistan, an average household with 4 family members consumes about 150 kW-h/month which costs about PKR 2250/month and annual costs about PKR 30,000. So the total cost paid for 5 years of electric bills can fund a Solar installation which can produce electricity for 25 years of not only their current needs but offers 66% additional capacity for future increases.

To me it is a common sense solution, which the policy and decision makers should have thought about, but it doesn’t look like anybody gave it a serious consideration. I know what you might be thinking, we don’t get Sun throughout the day or throughout the year and we haven’t factored in storing this energy or the cost of keeping/maintaining that storage. That can truthfully increase the cost of producing solar energy and a number of energy experts cite this reason enough to discard otherwise a sustainable, green and affordable solution for producing electricity.

I have some convincing and innovative ideas in that regard which I believe can make use of Solar energy a lot more practical and appropriate at least in Pakistan, but in general in any country where there is a gap between demand and production of electricity. First a little background, there are various setups for solar energy productionGrid-Tied, Off-Grid and Hybrid. What I am proposing is a Grid-Tied system along with Solar energy friendly policy changes including Net Metering.

A grid tied system allows a household to use electricity from the Sun when its possible and when its not, their house automatically switches to electric grid. Net metering is made possible by Grid Tie Inverters, which allow excess solar energy produced by a home to be transmitted to the national electric grid and special meters which can track how much energy came in and how much energy went out to the grid. The utility companies typically bill the net amount and in some cases the homeowner gets a check instead of a bill if they produced more energy than what they consumed off the grid. So the example we discussed above, a household with a 1 kW-h solar panel installation will produce 3000 kW-h per year which far exceeds their consumption of 1800 kW-h per year, resulting in a rebate for them from the utility company, sounds too good to be true?

With average per capita income of $1250 as of 2012, the big question is how in the world we can expect an average Pakistani household with a single earner (in most cases) to afford a Solar installation costing up to $1500? Honestly, that is the biggest and the toughest question, but lets do some math. The estimated cost of proposed Kalabagh dam is $5.7 billion as per an estimate in 2000, as we all know this project is politically and environmentally controversial. This dam on completion(which can take up to 7 years)will produce 3600 MW of electricity/day. Over time dams incurextra costs and have large footprint for communities, environment and wildlife.

With a 1 kW-h solar panel array per household with an approximate cost of $1500, we can get 3600 MW/day capacity by installing such arrays in 438,300 households at an estimated cost of $657,450,000 ($658 million approx) . The project off course will require sometime to plan, fund and execute but it can start yielding results as soon as the first household gets its Solar system installed. This costs compares at roughly 10% of the estimated cost of Kalabagh dam. We can achieve double the capacity of Kalabagh dam(7200 MW) and fill the 6000 MW/daily shortfall at a total cost of $1.3 billion. With this we will be paying for 7200 MW daily excess capacity for 25 years. I think it will be worthwhile to mention that in all my estimations I have gone to the higher end of cost as well as labor, with such a huge project we can easily get better rates for both equipment as well as labor, so the actual cost may turn out to be lower.

When it comes to manufacturing solar panels in such a large number, I am sure it will take sometime, but considering the current market capacity it should not take more than an year to get the desired number of solar panels. Besides, due to agile nature of these household to household installations we don’t need to wait for all the solar panels to be manufacture to start the project, they can get installed as they get produced.

Funding is still a big question, the government can invest on a project like dam because it will be a large piece of infrastructure, a national asset, however owning a million or so solar panels installed on a similar number of households is a different business, but wait we already have government owning large utility companies like telecom and electric supply companies with equipment installed on millions of households such as electric/telephone poles, electric meters, gas meters and so forth. The same mechanism the government uses to keep track of all that equipment can be used to keep track of and service solar panels, will just require a bit retraining for the field staff. If we go this route, a household can’t claim a rebate check as the solar panels will belong to the government so the additional capacity also belongs to the government, they get billed on their usage. Use of Solar energy however will significantly reduce the cost of producing electricity and consumers should also see part of that by significant reduction in electric bills.

Another funding alternate can be to acquire funding from private sector/international development agencies to issue loans to homeowners to install these solar arrays which can be paid in 5-10 years. Going with this option a large number of individual households will see a significant drop in their electric bills 50-75%, that money can go to pay off the loan for the solar installation. Government can enable this kind of arrangement with participation from lenders and the utility companies by including the loan payment in the electric bills and applying the same strict measures which they currently do to collect electric bills, which will greatly reduce the risk for the investors providing the funding and result in reduced financing costs for these loans. Most importantly, the government will not end up with a large long term obligation on its books, which they will in case of a project like Kalabagh dam.

Even with this approach, there will still be problems like overloading of the grid during times when there is no sun due to time of the day or weather, which can be overcome by smartly utilizing Wind, Existing Hydro power, possible utilization of tidal power as well as Nuclear energy, keeping use of oil/hydrocarbon based power plants as the last option, as they are the most polluting and most expensive source of electricity.

Although I am not an expert on this subject, but the quick research I have done along with relevant data and calculations I am convinced that this is the right way to go forward. I encourage you as a reader to look critically at all the figures and the logic behind this solution, if you are also convinced, please join your voice with mine and share it in your circle of friends/colleagues and lets turn this into a national dialogue.

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