Pakistan small hydro potential should not be ignored
PAKISTAN has enormous potential for renewable hydro power produc tion. It is good to see that the government has recently started development work on a number of large and medium hydro dams.
These projects will take several years to build and more years to fill water to production capacity, but once online they will provide cheap reliable renewable power for over 50 years.
Besides these large/medium hydro power projects, Pakistan also has many small and micro hydro sites that can be constructed within six months because they are run of the river projects and don’t require dams.
The government should develop these sites through local private sector by introducing right policies and incentives.
Firstly, every hydro power plant is constructed with the help of bank loans, as hydro power is reliable and long term projects.
Pakistan currently has announced fixed 6% loans for renewable energy projects, but these loans are small and short term for hydro power.
Hydro power requires 12-15 years fixed loans at the rate of max 3,200$ per KVA power plant.
Secondly, for every hydro power loan the main requirement is for customer buy back rate and agreement.
Pakistan Government has recently reduced the rate for large hydro power to 4.5 Rs large hydro power have the benefit of large quantity power production, but the smaller Hydro does not have this benefit.
Therefore to develop small/micro hydro in Pakistan the government should announce small/micro hydro power buy back rate or net metering rate per unit as Rs 15 for first five year, Rs 12 for next five years, Rs 9 for next five years and then fixed Rs 5.4 per unit for remainder life of project. And also announce that no capacity charge or other costs would be paid.
Thirdly besides allotting land for hydro power quickly, the government should also allot additional land, where an industry or commercial business can be constructed alone or in partnership, that would be powered by the hydro power plant in ten years.
This way a local industry would be created and government would have the option to stop buying power from Small Hydro plant in ten years.
Khyber-Pakhtunkhwa, Azad Kashmir and Gilgit-Baltistan provinces have hundreds of sites for small hydro power generation that can be constructed quickly and provide 75 GW renewable energy per year near large cities and national grid. With power generated and utilized locally, the load on national grid would also be reduced.
A positive policy covering all these aspects can help start development work on hundreds of small hydro power plants across Pakistan in the private sector.
These power plants would help provide continuous reliable renewable energy that would be used locally. And they can also promote the setup of new industries benefiting from cheap hydro power.
I therefore request the Pakistan Government to announce such a policy for small and micro hydro power quickly.
—The writer is contributing columnist, based in Peshawar.
