People voted for the Pakistan Tehreek-i-Insaf (PTI) largely because of its promise to empower the poor and improve the social justice system. Imran Khan, the prime minister-in-waiting, has a chance to catapult Pakistan into a leadership role on an issue that can benefit the most vulnerable segment of the population — energy equity.

Specifically, Mr Khan can capitalise on Pakistan’s high renewable energy potential. Although his party has made promising proposals for expanding renewables, he will likely confront several obstacles.

To begin with, it is estimated that there are 60 million individuals who do not have access to the electricity grid in Pakistan. The number becomes even bigger when it comes to people having substandard and intermittent access to the grid. Extending it to far-flung, remote areas is costlier and inefficient.

The solution lies in ensuring decentralised access to clean energy. No wires, no moving turbines and no high operation and maintenance costs. The answer lies in making available small, efficient and last-mile technological solutions, self-managed by families and communities. It is high time we intensified efforts to provide modern energy services to the millions who lack access currently.

In doing so, Mr Khan must rethink energy subsidies. Our power-sector subsidies are worth Rs120 billion per annum, but most of them goes to urban, affluent citizens. Thirty per cent of the population that is not connected to the grid does not receive any of these subsidies. These need to be redesigned to benefit the most vulnerable segments with an aim to provide them with sustainable, clean energy.

We need an energy agenda that is based on small-scale solar technologies for the vulnerable, greater transparency and competition in energy contracting

The government should subsidise solar home systems (SHS) instead of supporting mammoth state-owned generation and distribution companies that are synonymous with corruption.

Renewable energy accounts for less than 10pc of Pakistan’s installed power capacity, well below the world’s average. We are not dependent on fossil energy; we are addicted to it. Expanding renewable energy will not only cut our greenhouse gas emissions, but also improve our unsustainable climate trajectory.

A case in point is the population living in Gilgit-Baltistan and parts of Khyber Pakhtunkhwa and Balochistan where energy is most required in the winter. People have no option but to buy a tree at a cost of Rs20,000-30,000, which fulfils their energy needs, such as lighting, heating and cooking, for three to four months. This is not sustainable in the long run. A transition to clean energy can reduce air pollution, diversify fuel sources and strengthen energy security.

As for large-scale, grid-based electricity, the government should mull an outright ban on any new fossil fuel-powered projects. We should support the completion of existing China-Pakistan Economic Corridor (CPEC) projects, but our priorities should be right: any new power contracting should only be for cleaner and sustainable energy, such as wind, hydro and solar.

Vested interests call renewable energy intermittent. But given the ever-rising circular debt and Rs1.2 trillion in subsidies during the last five years, it is actually fossil fuel energy that has let us down. Load-shedding is still a permanent feature of our power sector.

There is another area that requires an urgent review and is related to the contracting of energy capacities. The world has moved to competitive and liberalised electricity markets in a bid to improve transparency and remove corrupt practices. Why should we not adopt it in Pakistan? Central Power Purchasing Agency-Guarantee (CPPA-G) has already established a framework for competitive markets. After due consideration and consultation, the framework should be pushed through. Its foremost advantage will be transparency in contract bidding, which is lacking in the current framework.

India transitioned to competitive electricity markets back in 2003. Although competitive segment is still 20pc of the entire market, it has established transparency and trust, which has enabled competition to flourish with a much improved and reliable bilateral market. The biggest discrimination to renewables comes from our own policymakers. They contract fossil capacity on fixed take-or-pay contracts at a mammoth 27pc return on equity while renewables are made to compete on price through tendering. To create a level playing field, fossil fuel energy should also be contracted through auction only, with an aim to move towards competitive markets.

The PTI has announced an ambitious plan to increase renewable power, especially through micro-hydro plants in KP. But there is also a need for the push for solar rooftops, which will enhance energy efficiency and promote net metering besides cutting oil imports. A concerted effort to encourage local industries to produce parts for renewable energy plants as well as small-scale solar energy solutions through tax incentives and access to credit is essential. Small things need to be expedited.

For instance, the Alternative Energy Development Board (AEDB) is sitting on a draft request for proposal (RFP) for solicitation of renewable energy on competitive terms for the last three years. Such delays are detrimental to the promotion of clean energy.

Moreover, renewable energy developers still face hurdles. Pakistan’s electricity infrastructure is decrepit. Aging transmission lines mean a lot of electricity is lost during distribution.

Plus, there is an ad hoc limit of 5pc of total installed power generation capacity for wind determined through the Grid Code Addendum for wind power projects by National Electric Power Regulatory Authority (Nepra). Such an arbitrary assumption requires re-evaluation. Grids in today’s world are far more resilient and capable than that.

Energy projects also face resistance from local communities in land acquisition matters. Much of the land is collectively owned, meaning both public and private entities must consult with dozens or even hundreds of people before beginning a project. This process often leads to long, expensive legal battles. A case in point is Neelum-Jhelum Hydropower Plant where the original cost has gone up substantially. The same could be true for new power projects, such as Diamer Basha.

The government should simplify the consultation and land acquisition process, take a stronger role in mediation and encourage projects where local communities can benefit from the energy produced.

To reform the power sector, the status quo needs to be demolished with a more inclusive energy agenda — one that is based on small-scale solar technologies for the vulnerable, greater transparency and competition in energy contracting.

The writer is an energy policy consultant

khurramklalani@gmail.com

Published in Dawn, The Business and Finance Weekly, August 20th, 2018