NEPRA determines upfront solar tariff

In a landmark decision the National Electric Power Regulatory Authority (NEPRA) has determined and approved the upfront tariff and adjustments/indexations for solar power generation for delivery of electricity to the power purchaser based on solar PV power plants.

This determination was given in accordance with Section 31 Sub Section (4) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 read with Regulation 3 of the Upfront Tariff (Approval & Procedure) Regulations, 2011 (vide S.R.O. 757(1) 2011). An applicant can opt for the Upfront Generation Tariff for Solar PV Power Plant once notified in the Official gazette pursuant to section 31(4) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997(XL of 1997.

The tariff of solar power is to reduce over time; it would provide energy security in the country in addi- tion to diversification in generation. Solar power would facilitate the economy and industry of Pakistan due to its unique benefits and competitiveness.

The Solar energy is clean, environment friendly and renewable and also provides benefit of carbon credits. The overall cost of project and generation cost is very much competitive.

Per MW cost of solar power although higher in the beginning but subsequent decline in cost makes it financially viable solution in the medium term. Its installation is easy and quick and can play an important role for overcoming energy crisis.

Low operation and maintenance cost of solar power project is an added advantage. It would mean less reliance on external imports of fossil fuel or no worry of depletion of indigenous natural resources likes gas.

Subsequently as the next stage after introduction of off grid solution solar panels can be provided to remote areas. In Pakistan connecting far off villages to the national grid would be very costly, thus giving each house a solar panel would be cost efficient and would save investment in transmission lines and transmission losses.

Many countries USA, Germany, Australia, Brazil, UK, Japan, India, China and Thailand are now generating electricity in bulk through solar system.

Pakistan receives one of the best solar irradiation in the world and has a potential to generate over 2.324 million megawatts electricity per annum through solar thermal and photovoltaic systems but this potential is yet to be tapped. Solar irradiation in Pakistan and India stands at 1,900 (kWh/m2), against China's 1,500 and Germany's 1,200. India has already installed solar power projects having 3,000 mw capacity, China 22,000 mw and Germany succeeded in installing 38,000mw of solar power generation capacity. The determination of upfront tariff is a step by NEPRA indeed in the right direction. Net metering is also being envisaged by NEPRA as the next step after inputs, comments and recommendations are received from stakeholders.