Joint venture with Chinese solar company to invest $700 million

LAHORE:

The shift towards electricity generation through solar energy is becoming a growing trend in Pakistan due to rising electricity prices, which domestic, commercial and industrial users pay through different distribution companies, haunting the general public.

Although the trend of installing solar panels by households is not new, many homeowners have previously turned to this cheap way of providing electricity, and some are also taking advantage of the countdown.

This rapid development is likely to accelerate further as governments now look to solar power to provide cheap electricity to low-income households. Provincial governments like Punjab have successfully penetrated solar energy panels in rural areas, mainly to run tube wells, which previously ran on expensive diesel fuel.

In the context of such developments, many companies are now looking to enter and invest in this lucrative market, either independently or through joint ventures. However, Chinese companies are apparently taking the lead in this race.

In the latest development, a Chinese company, Hanersun Technologies, has entered into an agreement with a local company, My Energy, to cooperate in the provision of 500 MW solar system projects.

According to the terms, an investment of $700 million will be made for the joint venture which includes different solar projects of 500 MW capacity. This will include the establishment of distribution networks, dealer network, warranty and service centers, as well as flagship stores.

Reading: Chinese solar company eyeing growth in Pakistan

My Energy, CEO, Tariq Wazir Ali emphasized the importance of providing sustainable energy solutions to the country. “Pakistan currently relies heavily on expensive furnace oil and diesel to generate electricity,” he said. There is potential for significant cost savings and the need to shift to cleaner energy sources such as solar energy, he added.

Ali also emphasized the importance of focusing on the steel and agriculture sectors in terms of solar energy solutions. It announced plans to complete several 500 MW projects under the joint venture within the first year of this JV.

Hanersun Technologies, Vice President of Sunny Sun acknowledged the lack of quality solar energy products in Pakistan and expressed the company’s commitment to work with its local counterpart to address this issue. “This JV aims to provide affordable energy solutions to the people of Pakistan and promote sustainable energy practices in the country,” he said.

Energy sector experts said that there is an absolute need to introduce high-tech solar solutions in Pakistan. They said energy prices are unlikely to fall. In fact, there is a high possibility that the unit cost of electricity and natural gas will increase further due to the conditions of the International Monetary Fund. People generally try to at least control their electricity bills through solar energy.

However, they warned that people may lose hope if they cannot get reliable and long-lasting solar energy solutions. “Solar energy is not a cheap product. The decision to install solar solutions can wipe out the savings, especially for households. Government institutions should also initiate checks and balances on companies offering such solutions with price control mechanisms besides promoting this industry so that the desired results are achieved,” experts suggested.

Published in The Express Tribune, March 12^u2024.

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