Pakistan ranks as world’s third-largest solar panel importer, Climate Prosperity Plan says

Pakistan became the world's third-largest importer of solar panels in 2024 after importing 17 gigawatts (GW) of solar power systems, according to the government's Climate Prosperity Plan (CPP), which also calls for major reforms to reduce circular debt and accelerate the country's transition to renewable energy.

Prepared by the Ministry of Finance in collaboration with the Ministry of Climate Change, the report states that Pakistan's solar imports doubled from the previous year, driven by falling panel prices and rising electricity tariffs.

The report says the shift towards solar energy highlights growing demand for cheaper electricity but also underscores the need to modernise the power sector to accommodate increasing renewable generation.

To address the sector's financial challenges, the report recommends restructuring or renegotiating high-cost power purchase agreements (PPAs), introducing more cost-reflective tariffs and gradually retiring older, inefficient fossil fuel power plants.

It says Pakistan has been paying for expensive electricity generation capacity that often remains underutilised, contributing to rising consumer tariffs and the accumulation of circular debt. The report argues that reducing dependence on imported fossil fuels through greater use of domestic renewable resources—including solar, wind, hydropower and biomass—would strengthen energy security, reduce pressure on foreign exchange reserves and lower emissions.

The Climate Prosperity Plan sets several long-term targets, including raising the share of clean energy to 60% by 2030, generating 50% of the country's electricity from renewable sources by 2035 and increasing that share to 95% by 2040.

It also proposes phasing out or converting 14,000 megawatts of fossil fuel-based generation by 2035, reducing transmission and distribution losses from 19% to 8%, achieving universal electricity access and installing rooftop solar systems at all government secondary schools by 2035.

In addition, the report targets the generation of carbon credits equivalent to 200 million tonnes of carbon emissions annually by 2030 as a potential source of revenue.

The report says investment in large-scale solar and wind projects, energy storage systems and grid modernisation will improve the reliability of electricity supplies while reducing the burden of capacity payments linked to underutilised thermal plants.