Sindh announces country’s first tariff-based auction for solar power project

The Sindh government has announced its intention to launch the country’s first-ever tariff-based auction for the development of a 50 megawatt (MW) solar power project in the province.

This will be the first project to implement the March 3rd National Electric Power Regulatory Authority (NEPRA) decision to enable tariff-based auctions for solar photovoltaic (PV) power projects, replacing the previous up-front tariff regime, a press release stated.

The pilot solar auction is one component of a larger programme on solar and renewable energy being developed by the Sindh energy department with the World Bank’s support. Tariff-based auctions have been successful internationally in rapidly reducing the price of solar power as a least-cost generation option in many countries.

The programme is currently under preparation, with plans to include development of utility-scale renewable energy projects, rooftop solar on public buildings, and support for off-grid electricity provision in rural areas. A key objective of the programme is to attract private investment into solar power in Sindh, including foreign direct investment.

Speaking at the One Planet Summit in Paris on Tuesday, Sindh Energy Secretary Agha Wasif Abbas, Sindh said, “We are excited that Sindh is leading the way by introducing price discovery for solar power tariffs in Pakistan. This 50 MW project is about demonstrating that solar power can be a least-cost generation option, and we look forward to welcoming qualified international and domestic solar power developers to bid on this project, and on subsequent renewable energy auctions.”

The provincial energy department has issued a Request for Information (RFI) to solar power developers and investors as a precursor to a formal procurement process that will take place during the second quarter of 2018.

The site for the 50 MW project will be on a government-owned land northwest of Hyderabad which has an excellent solar resource potential of more than 2,200 kWh/m2 per year. This equates to estimated annual production of around 85,000 MWh of clean, domestic power from the sun per year, immune to the price volatility of fossil fuels, the press release stated.