Govt to finalise four wind power deals worth $500m
Pakistan this year expects to finalise four wind power deals worth $500 million to exploit a renewable resource.
ISLAMABAD:
Pakistan this year expects to finalise four wind power deals worth $500 million to exploit a renewable resource that has been barely tapped in a country with a yawning gap between power capacity and demand.
The country suffers chronic power cuts that inflame public anger and stifle industry, a crisis seen by analysts as a test for President Asif Ali Zardari. Daily shortfalls are 4,500-5,000 megawatts (MW), water and power ministry figures show.
But the country’s coastal belt holds particular promise for wind power, with a potential of producing 50,000 megawatts, according to the US National Renewable Energy Laboratory.
Arif Alauddin, chief executive of the Alternative Energy Development Board (AEDB), on Friday said talks were underway with six Pakistani investors to build wind farms.
“We have reached a stage where I can say at least four deals will be finalised this year and production would start next year,” he told Reuters. “The worth of these deals will be $500 million.”
They would encompass four 50MW plants with expected completion by the end of 2011, he said.
Incentives
The AEDB is trying to boost local private investments in alternative energy by offering incentives and access to wind turbine makers and operators such as Siemens, Nordex SE, Coolwind, SWEG and General Electric.
Nordex in March agreed to supply FCC Energy Limited, a local company, with turbines for a 50MW farm in the southern Sindh province.
To attract private investors, Alauddin said the government is guaranteeing an annual rate of return of up to 18 per cent and will pay power producers if the wind blows below an annual average of 7.3 metres per second.
The AEDB has already allocated land for 18 independent power producers for wind power projects of 50MW each. The US Agency for International Development has plans to help Pakistan develop wind farms to generate 300MW by the end of 2014.
“You cannot expect changes overnight. It’ll take time. But we believe some 10,000MW would be coming through wind in the next five to 10 years,” Alauddin said.
The AEDB is carrying out national wind mapping for possible farms at other locations such as southwestern Balochistan and northwestern Khyber-Pakhtunkhwa.
The government is also looking at solar energy as another renewable option, and the central bank is offering to finance 80 per cent of local solar investments. The government has removed duty and sales taxes on solar technology imports.
Sixty-five per cent of the country’s electricity comes from oil and gas and 30 per cent from hydroelectric sources. An additional five per cent comes from two nuclear plants.
Out of total imports of $31.48 billion over the last 10 months, oil imports were $8.3 billion, government figures show.
“We’ve got to turn around our energy mix. We cannot afford it,” said Mohammad Khalid, director general of the Pakistan Electric Power Company (Pepco).
The government aims to add at least 2,000MW by December from seven rental power plants and one independent producer. REUTERS
Published in The Express Tribune, June 19th, 2010.
Pakistan this year expects to finalise four wind power deals worth $500 million to exploit a renewable resource that has been barely tapped in a country with a yawning gap between power capacity and demand.
The country suffers chronic power cuts that inflame public anger and stifle industry, a crisis seen by analysts as a test for President Asif Ali Zardari. Daily shortfalls are 4,500-5,000 megawatts (MW), water and power ministry figures show.
But the country’s coastal belt holds particular promise for wind power, with a potential of producing 50,000 megawatts, according to the US National Renewable Energy Laboratory.
Arif Alauddin, chief executive of the Alternative Energy Development Board (AEDB), on Friday said talks were underway with six Pakistani investors to build wind farms.
“We have reached a stage where I can say at least four deals will be finalised this year and production would start next year,” he told Reuters. “The worth of these deals will be $500 million.”
They would encompass four 50MW plants with expected completion by the end of 2011, he said.
Incentives
The AEDB is trying to boost local private investments in alternative energy by offering incentives and access to wind turbine makers and operators such as Siemens, Nordex SE, Coolwind, SWEG and General Electric.
Nordex in March agreed to supply FCC Energy Limited, a local company, with turbines for a 50MW farm in the southern Sindh province.
To attract private investors, Alauddin said the government is guaranteeing an annual rate of return of up to 18 per cent and will pay power producers if the wind blows below an annual average of 7.3 metres per second.
The AEDB has already allocated land for 18 independent power producers for wind power projects of 50MW each. The US Agency for International Development has plans to help Pakistan develop wind farms to generate 300MW by the end of 2014.
“You cannot expect changes overnight. It’ll take time. But we believe some 10,000MW would be coming through wind in the next five to 10 years,” Alauddin said.
The AEDB is carrying out national wind mapping for possible farms at other locations such as southwestern Balochistan and northwestern Khyber-Pakhtunkhwa.
The government is also looking at solar energy as another renewable option, and the central bank is offering to finance 80 per cent of local solar investments. The government has removed duty and sales taxes on solar technology imports.
Sixty-five per cent of the country’s electricity comes from oil and gas and 30 per cent from hydroelectric sources. An additional five per cent comes from two nuclear plants.
Out of total imports of $31.48 billion over the last 10 months, oil imports were $8.3 billion, government figures show.
“We’ve got to turn around our energy mix. We cannot afford it,” said Mohammad Khalid, director general of the Pakistan Electric Power Company (Pepco).
The government aims to add at least 2,000MW by December from seven rental power plants and one independent producer. REUTERS
Published in The Express Tribune, June 19th, 2010.