Alternate energy projects have recently been in the limelight in Pakistan and for good reason. With the acknowledgement of our respectable coal reserves, strong wind channels and more than 300 days of sun, it would be a waste of good resources not to take advantage of.
Bergamo E&As agreement to start a 544MW clean coal project in Lakhra with an investment of $420 million, and our local Engros agreement with the Government of Sindh for a coal project in Thar are a few steps in the right direction.
Even renewable energy production has taken a start in Pakistan, with a focus on the sustainability of operations, as Bergamo seeks to build a solar parabolic structure plant near Karachi so we can cater to our growing energy requirements.
Alternative energy is receiving more and more attention, internationally, with the calls for fighting global warming and the concern over depleting fossil fuel reserves. In this commotion, the economic advantages of using unconventional sources have also been revealed, and are inclined favourably in the long term.
While it is difficult to separate the hype from reality, one thing is certain; alternative energy solutions have made a definite and important place for themselves in the future. And herein lies an opportunity for betterment. If Pakistan starts now, we would be able to receive a jump start on a newly emerging industry and maybe even stand at par with the big global players.
The window of opportunity, however, may be fast closing as rising interest in this new global paradigm threatens to steal the potential early mover advantage away from us. India has already jumped onto the bandwagon with Suzlon, one of the top five alternative energy firms in the world. Headquartered in Pune, the company is reaching out as far as Western Europe - tech-advanced and alternative energy capital of the world - in an attempt to make use of some of the finest research and development facilities.
Yet, why arent we rushing into it? Here the question of economic viability crops up. While alternative energy is, no doubt, the answer to cost reduction from the long perspective, in the short term, however, major funding would be required to set up an entire alternative system. Although, the latest investment policy is focused on the E&P sector and at least some funding would be streamed into alternative energy, but, clearly, a more explicit scheme is necessary.
Incentives, tax windows, guarantees, and other enticements must be introduced to induce investors and researchers alike to enter the field. If more success stories follow, it is entirely plausible that in a decade or so, our focus would shift to indigenous and renewable sources for energy production. This would have a huge effect on Pakistans external gap problem as oil imports have historically been in command of not only the import bill, but the deficit as well.
One final issue; how prepared are we? What backup research have we done on our own? What is the foundation on which we can build our alternative energy realm? At the moment, not a very strong one. While we do have an Alternative Energy Development Board, not much research has been published by them.
Nor are our universities taking much interest in researching this area. We seem to be relying heavily on the technology and ideas foreign investors will bring with them. If we really are serious, as we should be, about entering alternative energy production, it is imperative that research, analyses and scrutiny in to the sector start taking place immediately.
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