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Sunday February 16, 2025

Pakistan eyes $100bn investment for ‘green energy revolution’

Additionally, $18bn will be required to support NEECA plans

By Israr Khan
January 30, 2025
An employee arranges a solar panel during a marketing demonstration in a park in Islamabad. — AFP/File
An employee arranges a solar panel during a marketing demonstration in a park in Islamabad. — AFP/File

ISLAMABAD: Pakistan will need $100 billion in investments to fully implement its ambitious renewable energy policies aimed at promoting renewable energy, reducing carbon emissions and transitioning to a sustainable energy future.

Federal Minister for Power Awais Ahmad Khan Leghari while briefing the Senate’s Standing Committee on Climate Change here outlined a roadmap to generate 60 percent of the country’s electricity from renewable sources by 2030, requiring $50 billion. This initiative is a key part of Pakistan’s strategy to combat climate change and reduce its dependency on fossil fuels.

Additionally, $18 billion will be required to support the National Energy Efficiency & Conservation Authority (NEECA) plans, including infrastructure development and incentives for electric vehicles and others.

The committee met here with Senator Sherry Rehman in the chair, to assess Pakistan’s climate strategy, focusing on electric vehicles (EVs), renewable energy and water scarcity.

Leghari, while highlighting the importance of these investments, noted that Pakistan’s reliance on expensive petroleum imports is a major economic strain. Currently, 55 percent of the country’s electricity is generated from eco-friendly sources, and the government plans to increase this share to 88 percent in the future. The introduction of a “Wheeling Policy” will further boost the production, sale, and purchase of green energy, enhancing the country’s renewable energy capabilities.

“We are not just focusing on electricity generation, but also its usage and special discounted tariffs to support environmentally friendly policies,” said the Federal Minister for Power.

The country’s first electric vehicle policy, which includes reducing the electricity tariff from Rs71 per unit to Rs39.70 is seen as a revolutionary step towards sustainability. Pakistan’s 30 million motorcycles consume 40 percent of the country’s total petrol, amounting to $6 billion in imports annually. The country’s transition plan includes converting petrol-powered two-and three-wheelers, as well as diesel-powered tube wells, to electric power.

Efforts are also underway to introduce financing options to support the shift to electric technology for vehicles, alongside the introduction of building codes to prevent energy waste and a programme to replace inefficient fans.

Senator Rehman criticised Pakistan’s lagging EV production, noting that only 60,000 EVs have been produced against a 600,000 target. She also highlighted that the transport sector contributes 48 percent to air pollution, making EV adoption critical. The Ministry of Industries faced scrutiny for lacking data on local EV production and charging stations.

Pakistan aims to install 3,000 EV charging stations by 2030, but only eight have been established. While over 1,000 individuals have registered to set up new stations, Senator Rehman urged faster expansion. She also called on banks to introduce EV financing to enhance accessibility.

The closure of five costly, high-emission furnace oil power plants (2,500MW capacity) was lauded for saving billions of rupees and reducing pollution. Freshwater reserves are depleting rapidly, with Sindh and Balochistan already running dry. Senator Rehman stressed solar-powered irrigation as a solution, given the harmful effects of current drip irrigation systems.