The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) on Wednesday urged the government to end curtailment on 12 wind power projects, stressing they produced cheap energy and aligned with the government’s renewable goals.
In a statement, FPCCI President Atif Ikram Sheikh criticized the government’s apparent preference for expensive power sources and urged it to adhere to the Renewable Energy Policy, 2006. He emphasized the curtailments were causing substantial financial losses for wind energy project developers, hampering their ability to service debts and maintain operations. The decision is also compromising their return on investment, jeopardizing future expansion, he warned.
Sheikh said sustaining the curtailments could hamper foreign investors’ confidence and have a negative impact on any future foreign direct investment in the renewable energy sector. The situation, he warned, could spiral into project defaults and financial instability.
Stressing on the importance of creating a stable, consistent and supportive environment for renewable energy, Shrikh said this aligned with the Special Investment Facilitation Council (SIFC)’s focus on the energy sector.
FPCCI Central Standing Committee on Renewable Energy Convener Fawad Jawed highlighted the economic and environmental advantages of wind power. He noted that wind energy in Pakistan offers clean, affordable electricity at a tariff of Rs. 13.8/kWh, significantly lower than RLNG, furnace oil and coal-fired plants.
Jawed said 12 wind power projects in the Jhimpir Wind Corridor, with a combined capacity of 610MW, were commissioned in 2021. However, he regretted, these plants face frequent curtailments and reduced offtake, hampering the ability to provide cheap electricity to the country. The situation, he said, undermined the country’s sustainable energy goals and hindered progress toward achieving a 50 percent emissions reduction by 2030 and a 30 percent renewable energy share in the national grid by 2030—as outlined in the Alternative and Renewable Energy Policy, 2019.
According to Jawed, the wind power plants have the potential to deliver exceptionally cost-effective electricity once they reach their capacity factor of around 38%. However, he noted, underutilization prevents these cost savings from being passed on to consumers.
In the interest of the national economy and power consumers, read the FPCCI statement, the body seeks an immediate and lasting end to the curtailments for the 12 wind power projects. The organization has also demanded the government honor existing Energy Purchase Agreements.