THE use of solar panels for energising tube-wells is not picking up fast despite the pressing need to help farmers increase farm productivity amid a persistent energy crisis.

The running cost of solar-powered tube-wells is much lower than those run on conventional electricity or diesel, by some estimates by one-third. But one-time cost of the solar panel through which sunlight is converted into energy is prohibitively high, at least for small farmers. That is why only a fraction of the country’s total number of tube-wells are being run under this system.

Most of these tube-wells belong to big landowners who have installed solar panels at their own cost and some are being run by groups of small farmers who have got this facility by pooling their savings and investment. Some NGOs have also installed solar panels in certain villages of Sindh and Punjab at subsidised cost to a community of farmers whose members operate tube-wells and lift pumps.

An estimated 1.1m tube-wells and lift pumps are currently in operation. But media reports and inquiries made at the provincial agricultural departments suggest that the number of solar-powered tube-wells is limited to a few thousands.

Inquiries reveal that 90pc all tube-wells are being run on diesel and around 10pc on conventional electricity. Solar-powered tube-wells so far constitute a negligible portion.

Efforts to integrate solar power into the national power grid have been accelerated in recent months without any commensurate efforts to switch electricity- or diesel-driven tube-wells to solar power and to expand the overall use of tube-wells

The problem is that the one-time cost of installing solar-panels that can run tube-wells comes to no less than Rs1.5m-1.8m which majority of farmers cannot afford. However, the running cost of a solar-powered tube well, a few thousand rupees a year in most cases, is nothing compared to Rs25,000-30,000 monthly average bill of a diesel or electricity-operated tube well, farmers say.

In December last year, the government had allowed duty-free imports of solar panels components and had also abolished the taxes on fully-assembled panels imported for installation in the country. Pakistan Solar Association’s Chairman Faiz Bhutto says the incentives has reduced the landed cost of both complete solar panels and their components by no less than 20pc. He says that about 400MW of solar panels were imported in FY14 and are expected to more than double in FY15 after tax incentives. He, however, also suggests tax abolition on imports of solar batteries to promote local manufacturing of solar panels.

Efforts to integrate solar power into the national power grid have been accelerated in recent months without any commensurate efforts to switch electricity- or diesel-driven tube-wells to solar power and to expand the overall use of tube-wells.

“This effectively means that many of our farmers cannot irrigate their fields properly which results in lower yields of crops,” says an official of Sindh agriculture department.

Wider use of solar-powered tube-wells, officials say, can play an important role in experimenting with crops growing and fish farming even in the areas that are off the national power grid and where farmers cannot afford high cost of diesel-based tube-wells or lift pumps.

As recently as February this year, a Chinese firm has installed the first-ever PV plant of 1.25MW in Punjab and connected it to the national power grid. Right now the plant is capable of providing solar energy to 110 villages but, going forward, it would cater to a much larger number of rural locations. And the economic coordination committee’s approval for standardised agreements for solar power projects will facilitate setting up of more PV plants. Local manufacturing of solar panels may go up over time.

But farmers’ representative bodies are aggressively lobbying for up to 50pc financial subsidy on solar-powered tube-wells while reducing their cost through domestic production or tax cuts on imports.

“ One way of addressing this issue is that banks should be encouraged to advance medium and long-term loans for purchase of solar-power tube-wells,” says a former president of Sindh Chamber of Agriculture. He says that most banks refuse such loans because the approved list of the items for which these loans can be made under SBP-supervised revolving agricultural credit scheme does not include the word ‘solar-powered’.

Published in Dawn, Economic & Business, March 30th , 2015

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