Recording and presentations: Expanding Renewable Energy in Pakistan’s Electricity Mix

December 3rd, 2020

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Preguntas y respuestas
# Question Answer(s) Live Answered
1 Hello, Can I get a web-link where I can get the recording of this Webinar please. Thanks Yes, we will send you the link to the recordings and the materials 🙂 Based on IGCEP2047 and current construction of thermal power plants, will it limit the uptake of RE in the future as the government is locked in to coal power plants? Is there also a risk of short term overcapacity so not so much RE and thermal power plants are needed as projected by the IGCEP2047 as T&D Is the bottleneck?
2 Hi,
IGCEP 2047 is an excellent road map and Plexoes was used for the modelling. The thing missing in the modelling was “Gas Peakers”. OCGT having low efficiency was used for balancing and high efficient gas engines were not included which are having efficiency of over 48% in open cycle operations. These gas engines are ULTRA FLexible which can achieve full power in 2min from start command.

NTDC and consultants should also consider ULTRA FLEXIBLE and high efficient gas engines along with BESS

Information on OCGT: The OCGTs were used as a “placeholder” technology which presents the need for backup/flexibility (which could be also provided by e.g. storage, interconnections, other / more hydrocapacity/operation, as well as gas engines). It does not say that such as such amount of OCGT has to be installed but this part should be further analysed (actually a process which is ongoing). Gas engines are very efficient but based on the fuel prices for gas and petroleum and the likely capacity factors (in comparison with other technologies, such as hydropower, large thermal power plants, VRE) they are likely still not competetive (as screened at th beginning of the project)  We have examples of Germany and other development countries where flexible power generation has backed VRE to have lowest LCOE. Atleast add Gas engines in Plexos and check the results.
3 Hi, please pros and cons of using Super capacitor based solar hybrid systems instead of Hybrid batteries solar system, if possibe. The study did not include a technoc-economic analysis of different storage options but used the a most common battery option / parameters to analyse whether and how storage could be of benefit. A separate study shoudl detail this (which may also incldue analysis of otehr technology solutions such as supercapacitors with likely lower costs but lower energy density etc.)  
4 Quite many countries are deploying BESS but in Pakistan BESS is still a dream. Is NTDC or NEPRA working on BESS? For information on the VRE Study: the study (report) includes two subscenarios analysing BESS integration;  further a more detailed analysis (e.g. in terms of network) was conducted together with NPCC. These studies coudl be used as a basis for further analysis / decisions / plans live answered
5 My question to Salis Usman sbI have a 50 hectors land near Lahore. Can i develop a Solar power station? How much power can i generate? Are rules permit for such powerhouse? Many Opportunities. Drop Email at  
6 Question to Mr. Karsten. Any opportunity to make a project with solar tracking systems in Pakistan? I am a development engineer at DEGERenergie GmbH Germany.   Yes, there is solar tracking (single axis) used / planned for in Pakistan. So definitely there is opportunity, to be analysed on a project by project basis (considering land etc.).
7 What is the consumer price for kWh All tariffs are published. You can go to any Disco website and see the tariffs for various categories. For example; about 10 USDc /kWh  
8 We are about to install a micro-grid of 10 kW for 25 village households. The ARE 2019 implies no need for NOC/NEPRA/DISCO approvals since generation only at one site and supply to only village domestic. The cost is expected to be less that USD 10,000 so expect that the project is not curtailed by approval red-tape…. pls advise Not related to VRE study or its outcomes in any sort. Please contact NEPRA and concerned DISCO for this purpose.  
9 My question regarding IGCEP, Whole world is moving away from coal, why we are planning to have more coal generated electricity in future? Pakistan Grid Emission factor is 0.6 ..much lower than other countries If it is good, you don’t want to make it worse.
10 Hi,

What will it take to attract foreign direct Investments into the renewable energy sector in Pakistan?

What do you see as the major hurdles for Western corporations trying to move into Pakistan’s solar and wind sector?

Hi Omair, actually Pakistan is generally seen as quite an attractive market for foreign investors in the power sector. However, for RE it will be important for the government to establish credibility in their intentions for competitive bidding so that investors know how and when they can participate. As I mentioned at the start, we are supporting AEDB with a RE Competitive Bidding Study, and we will continue to support the government with implementation of competitive bidding in Pakistan.  
11 What assumptions are you making about future fossil fuel prices in order to calculate the cost savings from the expansion of VRE? Where do these assumptions come from, and how robust are they? we started with actual fuel costs 18/19 at each power plant (incl. transport costs) and applied international forecasts (WEO) for imported fuels (all but Thar (domestic) coal and domestic gas) and for Thar coal the regulated price Was it just a single forecast of prices, or did you test the results against a range of potential future fossil fuel prices. If you look at IEA and other global outlooks, their implications for fossil fuel demand and prices are very wide-ranging. So there is a risk of using a single forecast, which is very likely to be wrong
12 What is the correlation bewteen the outcomes/methodology of the VRE study and the IGCEP? See also report: “This IGCEP was developed with strong contributions
from this study project through capacity development that contained on-site and remote trainings
and other measures of know-how transfer. This included the joint development of a wide range of
assumptions, data bases, and planning approaches used in both reports, as well as applying the
same modeling software PLEXOS,7 including support to the PLEXOS model development for the
IGCEP 2047. It should be noted that despite being based on a largely overlapping assumptions and
modeling approach, the results of this study and IGCEP differ in some details. To some extent this
is due to the fact that for this study, some data updates from power generation agencies could
not be considered anymore as data collection was agreed to stop at the end of 2019. Further, the
purposes of the two reports are different; the IGCEP was the official expansion plan according
to official requirements, and this study focused on VRE integration with a range of sensitivities
and tests of constraints and opportunities. Therefore, some approaches and assumptions differ, e.g., on the planning horizon (2040 versus 2047), load factors, or the representation of network.
So, in some areas the outcome of the two reports complement each other by considering different
possible developments and providing added value to the sector and the decision makers.”
live answered
13 Why Solar CSP has not been considered in VREs? The study did include consideration of CSP, but it is more expensive than solar PV and so is not taken up by the model in the least-cost scenario. However, this could be countered by using concessional (climate) finance to bring down the cost. Exactly, only Capex below 50% of the asusmed current costs would make it cost competetive (see scenarios in report). There could be further optimisation in terms of size and storage. However suitable locations are limited due to Monsoon impact CSP is not variable! It is actually dispatchable 🙂
14 What Weighted Average Cost of Credit (WACC) has been considered in cost analysis? and whether Government share as invester to reduce risk, and hence cost, been considered or not?   the study was conducted with an economic analysis with a discount rate of 10%
15 Does VRE also consists of Offshore Wind? Is Offshore Wind viable in Pakistan? Offshore wind is very marginal in Pakistan because the wind speed offshore reaches 7 m/s (average) only in a couple of small locations. In our view offshore wind would not be a logical short-term option while there is plenty of low cost onshore wind and solar to exploit, but perhaps it will be an option in the longer term. If you would like to see the results of our analysis on offshore wind please visit this page:  
16 DISCOs have recently placed limits on PV net-metering defined for specific feeders. This could add much uncertainty for expanding PV in future, pls comment From the perspective of NTDC, we only need Net Metering data to consider their quantum for long term demand forecasting, major input for the IGCEP. As far as limiting PV net metering to specific feeders is concerned, I believe NEPRA, AEDB and DISOCs are in a better position to respond to this query.   
17 Why CCGT mix is decreasing over the years? For two reasons: i) when fuel supply contracts for RLNG end the capacity factor drops  ii) gas prices for imported gas are too high to compete against other enrgy sources (fossil and renewable); therefore CCGTs are used only durinbg times of high demand   
18 what percentage of installed capacity/Energy output is High RE Share? we defined a target of above 90% of generation in 2035
and above 95% in 2040 for RE (or: no carbon, i.e. incl. nuclear)
19 what do you mean by no longer competitive? the short term marginal costs (mainly fuel) of respective plants (coal, petroleum and gas based) are higher than costs of VRE (incombination with hydropower); therefore VRE are expanded in teh optimization and replace (together with hydropower) these plants (which are only used e.g. if demand is very high)  
21 Granted VRE is the least-cost generation expansion option with all the associated bebenefits (environmental, flexibility, hedge against global fuel price, etc), can you comment on the economic sustainability of the magnitude of investments required or envisaged.  What is the macro-economic rationale versus other competing investment requirements? We applied the economic analysis approach with a discount rate of 10% which is resulted in net benefits of VRE integration compared to other sceanrios (e.g. no further VRE).  
22 What Environmental Cost (Rs/Kwh) will make Coal Power geneartion uneconomical/non-competitive? Faisal PPIB We analysed a the low carbon cost scenario (World Bank shadow prices for coal) which increased the generation costs by 4 – 6 USDcent (~8PKR) / kWh and by this made coal uneconomical (to build). we did not identify the threshold (which could of course be done by NTDC / our model) but it is likely considerably lower. As domestic coal generation today is at some 0.02 USDc / MWh (3 PKR) and imported coal at some 0.04 USDc and imported coal is not competetive (even without co2 costs) maybe some 4-5 PKR may make it uneconomic to build. When generation from existing plants becomes non economic is a bit more complex to answer as prices differ with demand / season, hence it is rather a question when would coal based generation drop below XY% capacity factor which may make it uneconomic to sustain. This of course could be also analysed. To analyse any future probable risk for these investments such an analysis is recommended  
23 Karsten, maybe you could add some details how you included environmental costs in yr analysis (incl quantitative assumsptions) Only CO2 costs for climate considered according to World Bank shadow price of carbon low sceanrio, starting at USD 40 per ton to some USD 63 in 2040, resulting in about this additional costs per MWh  
24 Could you please explain the scnenario high share of RE   live answered
25 The 5 main local coal blocks in Thar for power generation of over 5,000 MW have been locked in for the next 30 yrs, with 2 UK license owners, 2 Chinese and 1 Pakistani.    While it is good to phase out coal, how can one escape from the above locked-in commercial scenario where investors have risked substantial initial costs? In our analysis we considered contractual obligations, e.g. fuel supply contracts but also particular costs by Thar coal power projects. Still it is more beneficial to add more VRE (and no more coal until 2033-35). there was no sceanrio on “phasing out coal”. But with the model and data set it could  be analysed to identify internal and external costs and benefits of such a scenario. Besides this tehre are now numerous examples in industrialized but also emerging countries how to phase out coal  
26 Have demand side management and other type of energy efficiency action been considered in the study? See study report for DSM assumptions (in annex and disruptive technology sceanrio) as well as consideration of DSM at NTDC PSP live answered
27 While DISCO/NTDC is asking for very high Wheeling Charges, how this study would support the Wheeling when there would be B2B businesses. Do you think this study would also support, B2B RE projects in additon to Utility Scale RE projects. Thanks – Arooj Asghar Wheeling is altogether a different area. This particular study like all other studies has limited scope. And it does not cover different types of projects.  
28 Can wheeling bulk buyers of clean energy such as cell phone tower companies use at different geographic end-points within the same DISCO jurisdiction? Not related to VRE study planning and integration or its outcomes in any sort  
29 The World Bank imposed ban on Public Sector for doing any further power project in 1988 thus IPP sector was initiated. How the World Bank is ensuing that Public Sector Project will not get unfair priority and Private Sector would not be ignored. As Private Sector is historically more efficient than Public Sector. Thanks – Arooj Asghar Hi Arooj, I’m not aware of any World Bank “ban” on public sector power projects, but you are right that we do have strong principles in favor of utilizing the private sector where they are best placed to invest and deliver. However, there are several examples where the public sector still has a strong role, for example large hydropower and investment in the transmission and distribution system. There is also a potential public sector roles in establishing solar and/or wind “parks” combined with competitive bidding, which the World Bank has financed in several other countries. I should add that the purpose of solar/wind parks is to create the shared infrastructure under the public sector, but have the private sector finance, construct and operate the power plants within the parks following a competitive bidding process. The World Bank is actually financing this already in Pakistan under the Sindh Solar Energy Project.
30 Presently, there are not much wind power projects in Jhimpir Wind Corridor but when there would be many Wind Projects then the higher efficiency of wind turbines would be off-set by high Wake Losses. In that case; do you think Wind would still have a competitive edge as comapred to other technologies. Thanks – Arooj Asghar Hi Arooj, certainly wake effects need to be considered in the planning of wind parks as this can affect the capacity factor. I see this as both an issue for the planning of RE parks (i.e. responsibility of the provincial energy departments) and also a siting issue for each project developer.  
31 Pakistan being a developing country amongst the country having lowestcarbon foorprints  aroun 0.98 Metric Ton per capita) with smaller share ocoal power generatin in its overall energy mix (upto 12%) and  number of peculiar sectroral, infrasrtucture and economic issues may need to develop coal based power plants by utilizing our indeginous thar coal to meet our future base load requirements and for energy security of country. So may be consideration of envomental cost on coal generation will not be a rationale treatment keeping in view the country’s energy needs and ecnomic and technical constraints. Faisal Sharif The findings on the future role for coal consider this issue with and without environmental costs. Even if you exclude environmental costs coal is no longer the least-cost option in Pakistan. Of course there may be other social and economic factors to consider with regard to domestic coal but these should be balanced against the water requirements, GHG emissions, and other environmental costs. The final decision is one for the government.  
32 To what extent is/are the models used for this study compatible with the Integrated Energy Model (IEM) at the Planning Commission (PC).  Put another way, how extensive was the team’s collaboration with PC?   Yes
33 what is your onion on why we could not support/develop small hyros on canals in punjab NTDC’s role is restricted to generation planning and for that NTDC relies on the data from project execution entities. Development of small hydros on canals do not come under the purview of NTDC. Provincial project execution entities should be approached for this query.  
34 Is this study taking into consideration the injection of RE systems being installed by residential and industrial consumer? See study report distributed PV scenario for an aggregated consideration; which resulted that it is more costly but still competetive compared to no-VRE live answered
35 Pakistan’s Distribution and Transmission network are not being maintained and upgraded especially in terms of SCADA and protection systems. More recently there had been instances where the country had major blackouts due to the protection malfunctioning.
How this study has taken into account the current state of T&D network as renewable energy requires more precise SCADA system?
How the current networks will be able to handle the generation mix being proposed/projected by this study to ensure the reliability?
Hi Qasim, actually this issue is explicitly addressed in the study and investment in SCADA is part of the recommendations along with better forecasting for solar and wind. Please download the report for more details. That said, the study is not a detailed analysis of the T&D system, which NTDC will need to work on separately as part of a transmission system masterplan.  
38 Is there any funding plan for development of small HPP’s on canals?
In your study, NTDC placed evacuation from small hydro’s in 2047 whereras COD was supposed to be in 2023.
PLEXOS model for the IGCEP, focuses on least cost principle, considers on various pararmeters including Available Capacity; Fixed O&M; Heat Rate/Efficiency (for thermal); Plant Availability; Fuel Consumption; Capacity Factors; Fuel Price; Hourly PV & Wind Profiles; Plant Up and Down Time; Hydrology (For Hydros); Ramp Rate; Fuel Contract bindings; Maintenance Rate; Reserve Provisioning; Forced Outage Rate; LOLP Criteria; Build Cost (CAPEX); Capacity Reserve Margin; Economic Life; Policy Targets; Variable O&M; Load Curve; and System Hourly Demand. The model optimizes each and every proposed project including small hydro.  
39 Could you please comment on the following: (a) long-term electricity demand forecast in the context of delivered consumer prices in the future; (b) RE targets established in the ARE Policy 2019, and the realism regarding fossil-fuel plants capacity displacement, reserve margins assumed, and investments needed in the generation and transmission infrastructure; and (c) market structure as it exists, for RE development. For a) We reviewed the demand forecast scnearios of NTDC (incl. low and high) and adapted them for teh purpose of this study. But even with a stagnation of growth there is room to expand VRE in the current system For b) we considered in the simulation restrictions and requirements with regard to take or pay / PPAs (fossil fuel plants) with regard to dispatch and reserve provisioning; we considered in a detailed way current and future reserve provision (which has to change with and without VRE) to be more secure and flexible (as teh current system does not even fullfill teh Grid Code requirements, which shoudl be also reviewed). investments in generation infratsrrcuture was fully considered. Investments for network is addressed in teh VRE Locational Study where first results have showed that sufficeint local capacity is available with no / little investment to allow a considerable share of the VRE of this study; further, also conventional generation sources need reinforcement and expansion of teh network c) market is a separate topic. there are different options for  power markets based on worldwide experience to realize the economic benefits identified in this study. There are also good practices how to arrive there.  
40 A naive question – am I right in assuming this study complements IGCEP, but has (not yet) been integrated into the Transmission System Expansion Plan which Salis has mentioned in his talk. Yes that is correct. Salis may wish to elaborate. Thanks Oliver.  I can contact him separately, also.
41 Question to To Karster Schmitt suggest deleting  
42 Climate Change may be a very serious issue in coming years. We hope in your current planning this aspect would have been considered? If you mean climate impacts (such as changing weather) this was not part of the scope, in part because there is still a lot of incertainty on what these impacts will be. In the medium term there is some evidence that hydropower generation will increase due to the melting of glaciers. There is no evidence yet on what the impact will be on solar and wind generation. With regard to climate change mitigation the study does consider this as part of the GHG reductions that investment in RE would generate.  
43 Does the study assess savings of electricity/associated GHG emissions by shifting to higher energy efficiency distribution transformers? The study looked at HV transmisison level only and did not look at potential (additional) loss reduction measures (beyond the plan). There could be a positive effect which has to be analysed in a different study, focussed on this issue  
44 on the project finance side, with such agrressive RE targets how do we propose to bring in the financing specially when the govt of Pakistan is more and more shying away from soverign guarantee regime – and how do private PPAs EPAs play a role in financing new investments..   live answered
45 Currently the wind projects are facing excessive curtailments, NPCC is preferring coal, RFO plants as per economic order. If govt is not giving priorty to Renewables than how can future projects of bigger capacity can be initiated by private sector Such curtailment is a short term phenomenon and it is likely to be mitigated in short time. NTDC is committed to adhere to targets of ARE policy 2019 in terms of setting up and operating VRE in the most optimal manner.  
46 My question for Salis sab is , that considering ideal scenario that we achieve 25% RE in the energy mix by 2025 and 30% by 2030, what would  be the Energy Purchase Price (PPP)  by 2025 and 2030.? For this prupose, CPPA-G has prepared a ‘End Consumer Tariff Forecast’and submitted to NEPRA. We need to check with CPPA-G whether it can be made public or otherwise. good question. i wanted to ask this question
48 To Mr. Salis Usman: Can you please elaborate NEPRA restrictions on maximum resedential connections of Net Metring on a particular PMT/Feeder? In my opinion, it would be appropriate that relevant entities such as NEPRA, DISCOs and AEDB respond to this question.  
49 I belive in future project, in addition to seasonality IFC needs to consider forced curtailments and outages in financial models of renewables projects. Such curtailment is a short term phenomenon and it is likely to be mitigated in short time. NTDC is committed to adhere to targets of ARE policy 2019 in terms of setting up and operating VRE in the most optimal manner.  
50 can we say that, currently, Pakistan is in a overcapacity situation? I would add that usually you should have a considerable overcapacity in an expanding system as Pakistan to avoid another shortage and respective load capacity (if there are delays etc.) Generation capacity is enough, Now lack transmission and distribution system capability.
51 We did a quick assessment of corellation between AQI during smog in Lahore, and production of solar energy in the day, and found a reduction of solar energy in the day by 100% when air quality deteriorated by about 40%. Unfortunately smog may stay with us for some time, pls comment Yes solar production is reduced by factors such as smog. However, solar plants will tend to be outside major cities due to land availability, and such factors are generally taken into account at the siting and pre-feasibility stage. With PV plants usually distributed throughout a large country like Pakistan these effects (on variability and reliability) will level out on average.   
52 To Mr. Salis: What support ypu have provided to small hydros in IGCEP NTDC’s mandate is to prepare the IGCEP for which project execution entities propose new generation projects. Under GoP’s policies, project execution entities are there to support all the generation sources including small hydros.  
53 How Can you utilize existing infrastructure in your planned VRE? Will it be benificial in terms of cost and benifits? There are various ways to use existing infrstructure which is usually evaluated in VRE/RE plans / locational studies; e.g. network / transformers (available capacity or additional capacity with little invetsment; this is one advantage of VRE that it can be modular and close to existing substations; this is analysed in teh VRE locational study; in the VRE integration and planning study the expansion of intra-zonal transmisison is considered and how VRE could save such costs); other infrastructure (e.g. access roads); even areas which are of no other use (e.g. floating PV on canals, lakes).  If these benefits are considered correctly it coudl add to the cost benefits of VRE at current and still decreasing investment costs.   
54 To Salis Sb, In IGCEP small hydros having COD in 2023, the evacuation are planned in 2047. Please clarify? PLEXOS model for the IGCEP, focuses on least cost principle, considers on various pararmeters including Available Capacity; Fixed O&M; Heat Rate/Efficiency (for thermal); Plant Availability; Fuel Consumption; Capacity Factors; Fuel Price; Hourly PV & Wind Profiles; Plant Up and Down Time; Hydrology (For Hydros); Ramp Rate; Fuel Contract bindings; Maintenance Rate; Reserve Provisioning; Forced Outage Rate; LOLP Criteria; Build Cost (CAPEX); Capacity Reserve Margin; Economic Life; Policy Targets; Variable O&M; Load Curve; and System Hourly Demand. The most feasible COD (year) is optimized by the model without any manual intervention by NTDC.  
55 To Mr. Karsten! Can you please let us know what formula for evacuation has been used for small hydropower plants? For small hydropower plants (SHPPs) evacuation flat generation per month based on historic average capacity factors per month were were considered, i.e. base load according to installed capacity and capacity factor and providing also firm capacity. Please note that this study did not optimize / evaluate SHPP but considered it “in an aggregated way by means of a realistic
generic expansion path of 80 MW per year (in reality consisting of individual capacities of up to
50 MW), which added up to a total capacity addition of around 1,500 MW until 2040. This is in line
with the potential stated by AEDB as being available for development and constituting roughly 50%
of the total potential for small hydropower” see also study for details
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