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Pakistan Energy Sector

and
prospects for business

Pakistan Business Day in Hamburg

15th December 2016

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Geographical location of Pakistan

Federation of 6 provinces and states

Total area : 881,913 sq-km
Population: 200 Million 6th in the world
Electricity Shortfall: 5000 MW
Un-electrified population 30%
GDP Growth 4.5%

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Energy Situation
PRIMARY ENERGY SUPPLIES BY SOURCE
Millions Tonnes of Oil Equivalent (TOE)
80
70.3
66.85
70 64.7 64.6 0.3%
13.2%
12.5% 13.3%
60 12.8%
7.0%
6.6% 5.4% 0.7%
6.0% 0.5%
50 0.5% 0.5%

42.6%
40
49.5% 48.2% 46.3%

30
0.7%

20

10
30.8% 32.5% 34.4% 35.5%

0
2011-12 2012-13 2013-14 2014-15
Oil LNG Import Gas LPG Coal Hydro, Nuc. & Imp. Renewable Electricity

Source: Pakistan Energy Year Book 2015 published by Hydrocarbon Development Institute of Pakistan (HDIP), Ministry of Petroleum & Natural Resources, Government of Pakistan

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Energy Situationcont.
ENERGY CONSUMPTION BY SECTOR
(Excluding fuels consumed in thermal power generation)

Source: Pakistan Energy Year Book 2015 Published by Hydrocarbon Development Institute of Pakistan (HDIP), Ministry of Petroleum &
Natural Resources, Government of Pakistan

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ELECTRICITY INSTALLED CAPACITY BY TYPE

PEPCO and KEL (Public and Private)

24,953 MW
23,167 MW 23,617 MW 25,255 MW 26,197 MW
21,257 MW
23,302 MW

RE

Nuclear

Thermal
2010 2011 2012 2013 2014 2015 2016
Hydro
RE 50 106 408 1136
Nuclear 462 787 787 787 787 787 1.127
Thermal 14.240 15.753 15.888 15.852 16.963 16.963 16.814
Hydro 6.555 6.627 6.627 6.928 7.097 7.097 7.121

Source: CPPA, AEDB and NEPRA

* Total Capacity as on 24th October 2016, It is an in house data collection effort

**1136 MW capacity of RE, Reference: AEDB (Alternative Energy Development Board)

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Power Demand Forecast

120000

101478
100000

80000 72169
MW

60000
44903
35413
40000

22353
20000

17328
0
2007 2010 2013 2016 2019 2022 2025 2028

Source: CPPA, AEDB and NEPRA

**1136 MW capacity of RE, Reference: AEDB (Alternative Energy Development Board)

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Power Sector of Pakistancont.

Electricity Generation Mix Projections

Source: Ministry of Water and Power (MoWP)

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Policies and Legal Framework in RE - Sector.

First RE Policy (Wind, Small Hydro and Solar)
Approved in 2006 and valid till 2018
Biomass/Bagasse framework was added in 2013
Grid provision is the responsibility of the purchaser
Guaranteed Electricity purchase
Protection against political risk & change in law
Return on investment is between 17%
Feed-in-Tariff for solar PV, wind, small hydro and bagasse based power projects
No Custom Duties and Zero Sales Tax on import of Equipment
No Income Tax / withholding tax / turnover tax
Convertibility of PKR into USD
Net-metering Regulations 2015
Allows development of small scale RE distributed generation up to 1 MW from
solar PV and wind energy projects or own consumption
Access is exported to the national grid and receive powet from the grid when
needed
Monthly bill is settled on net-consumption
Other power generation policies 2013 and 2015

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Renewable Energy Potential in Pakistan

Hydropower
Documented potential : More than 60,000 MW including large Hydros (source PPIB,
MoW&P)

Solar PV
Pakistan receives one of the best solar - irradiation in the world
The average solar irradiation is 5-7kWh/m2/day

Wind Power
Total wind power potential : over 300,000 MW (Source NREL-USAID study)
Solar Thermal
The average solar irradiation is 5-7kW/m2/day
It can produce 1000s of MW Solar Concentrated Power (CSP)exact figure is not yet
documented

Biomass for Commercial power generation

A potential of about 3000 MW exist for utility scale power generation
(according World Bank ESMAP study-2016

- Other options e.g. Geothermal energy are not yet documented

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Solar and wind energy maps of Pakistan

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RE- Potential in Off-grid application

Substantial rural population has no access to the grid, and the
population that does have access to the grid is struggling with
power cuts and supply shortages

According to the World Energy Outlook (2016) statistics 51 Million

people in Pakistan lives without access to electricity and 105
Million people (56% of total population) have traditional use of
biomass for cooking purposes.
32,889 Rural Villages cannot be connected to the grid
technically and economically are not feasible.

Source: http://www.pakistantoday.com.pk/2015/10/20/news/power-outages-of-up-to-10-hours-imposed-again/

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RE- Projects (operational and in pipeline)

1. Wind Projects
I. Operational 590.5 MW
II. Under Construction 298 MW
III. Pipeline Projects 864 MW

2. Solar PV
I. Operational 400 MW
II. Pipeline Projects 1775.52 MW
(LOIs issued by AEDB & DoE Punjab)

3. Biomass/Bagasse
I. Operational 145.4 MW
II. Pipeline projects 387 MW
Source: AEDB

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Energy Conservation Potential in Pakistan

According to the National Energy Conservation Authority (NECA)/ previously

(ENERCON), annual energy savings of up to 25 percent are possible in all
sectors, which equates to approximately $3 billion per year in energy
imports.
The most suited EE options of all sectors in terms of technological measures
are co-generation, compressor, heat recovery, heat transfer, lights, meters,
motors, power factor, process control measures, and maintenance of steam
distribution system.
For RE developments, photovoltaic (PV), solar water heater (SWH), and
wind energy are considered to be the most feasible options on the local
industrial scene.

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Pakistan Germany Renewable Energy Forum (PGREF)

The Pakistan-German Renewable Energy Forum (PGREF) is a cooperation

initiative between the Governments of the Islamic Republic of Pakistan and the
Federal Republic of Germany supported by Deutsche Gesellschaft fr
Internationale Zusammenarbeit (GIZ, German International Cooperation) on
behalf of the German Federal Ministry for Economic Cooperation & Development
(BMZ).

Objective
The main aim is to create a network between the two countries respective
industries, public sectors and innovation networks in the Renewable Energy
(RE) and Energy Efficiency (EE) field.

It is meant to involve and link-up the private sector more than GIZ or the
governments on their own can hope to achieve.

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Financial Schemes for Investment in RE

State Bank of Pakistan (SBP) announced for the firstRe-

financing Scheme for RE projects in mid-2016

Projects from 4 kW to 1 MW
@ 2% to Commercial bank and 6% for the developers for 10
years

Project Financing from 1 MW to 50 MW

@ 2% to Commercial bank and 6% for the developers for 12
years with 2 years construction period.

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Benefits of RE and EE for Pakistan

Development and RE and EE sources ( is not the
question anymore).

Energy for Economic Growth (Closing the gap

between import and export)

Energy Security (not depending others for supply)

Jobs and industrial competitiveness
Climate change (Reduction in CO2 emission-Global benefit)
and improved investment opportunities in the country

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Other mega pipeline projects Projects

3.75 million tons of LNG would be imported annually from Qatar on a government-to-government basis which would meet
close to 20 per cent energy requirements of Pakistan (agreement signed on 10th Feb16)
3.2 Bcfd TurkmenistanAfghanistanPakistanIndia (TAPI) Gas Pipeline Project (at Planning Stage)
1752 MWp Solar PV Power Projects (at different development stages).
750 MMcfd Iran-Pakistan (IP) gas pipeline project (at planning and implementation stage)
1000 MW Central Asia-South Asia Electricity Transmission Interconnection(CASA-1000) Project (at planning stage)
Study for Master Plan of 6,600 MW Pakistan Power at Gaddani, Balochistan ( at planning stage) Coal Projects
1320 MW Coal Fired Power Project, Sahiwal (Construction Phase: ref DoE Punjab)
2640 MW Coal Fired Power Projects at Rahim Yar Khan and Muzaffargarh (feasibility study phase, reference DoE Punjab)
Installation of new Coal fired Power Plants having capacity 2x660 MW, at Jamshoro (under construction)
Construction of 132 KV New Substations, Conversion of 66 KV to 132 KV Sub-station and Associated T/Ls, Extension and
Augmentation Sub-projects, (PESCO) source: MoW&P.
Refurbishment and Up-gradation of Generating Units of Mangla Power Station additional 644 GWh will be generated
financed by (USAID)
4320 MW Installed Capacity Dasu Hydropower Project, expected completion date (March, 2019)
1400 MW Terbella Dam Extension under construction, expected to be completed by Dec. 2017.
940 MW Neelum Jehlum Hydropower Project under construction, expected to be completed by Dec 2017.
Development of 4500 MW multi purpose Basha Hydropower Project (Planning stage)

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Potential Business Areas for German Companies

Equipment and Machinery Supply Technical consulting and support

services
Hydropower Plants (Electromechanical
Techno-economic feasibilities
equipment, control devices etc. )
Grid Studies
Wind projects
Developing Tender Documents and Process
Solar Projects
O&M Procedures and Protocols incl. Testing and
Textile Industry (energy efficient machinery)
Commissioning
Power lines etc.

Innovative Technology Applications EPC Services

JV in EPC Contract in all fields
HVDC power lines Participation of German companies adds value to the
Smart grid concepts and applications Projects
Smart power meters (

Weather forecasting for RE etc.

Source: http://www.pakistantoday.com.pk/2015/10/20/news/power-outages-of-up-to-10-hours-imposed-again/

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As a federal enterprise, GIZ supports the German Government in Responsible

achieving its objectives in the field of international cooperation for Dr. Frank Fecher
sustainable development.
Published by
Deutsche Gesellschaft fr Authors
Internationale Zusammenarbeit (GIZ) GmbH Mohammad Irshad Khan
Registered offices, Bonn and Eschborn, Germany
Renewable Energy and Energy Efficiency Project
Regency Heights, Plot 3A/3, G-5 Markaz, Diplomatic Enclave
Islamabad 44000 Pakistan
T +92 51 8358913
F +92 51 8351103
E mohammad.irshad@giz.de
I www.giz.de

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