Pakistan requires over $100 billion in investment to transition to a carbon-neutral energy sector, with $50 billion needed to achieve its 60% renewable energy target by 2030, climate ministry officials told the Senate Standing Committee. Additional investment is required to cut emissions by 50% and implement the National Energy Efficiency and Conservation Authority (NEECA) Plan 2023-30, which alone requires $18 billion.
During the meeting, chaired by Senator Sherry Rehman, officials highlighted the crucial role of global financial support from institutions like the Global Environmental Facility (GEF) and the Green Climate Fund (GCF) in reaching these climate goals. The committee also received a briefing on the electric vehicle (EV) policy from the Ministry of Industries and Production, which stated that a steering committee on EVs had been formed by the prime minister.
The climate change secretary emphasised the importance of introducing electric vehicles in public transport to reduce carbon emissions, stating that transportation had the most significant impact on air quality. He also revealed that a proposal to subsidise two- and three-wheelers was under consideration.
However, Senator Rehman pointed out that pollution from other sources was a greater concern and criticised the industries ministry officials for their lack of preparedness. She expressed concern that the officials were unaware of the number of local EV manufacturers and questioned how the government planned to promote EVs without a clear roadmap.
Rehman also raised concerns over recent modifications to net metering regulations, arguing that they could discourage solar power adoption. She urged the climate change ministry to push back against any policies that hindered solarisation.
Energy Minister Awais Leghari informed the committee that solar adoption in Pakistan was already gaining momentum and assured that there was no plan to curb solarisation. He acknowledged that while solar investments currently pay off within 18 months, new regulations would extend this period to four years.
He also noted that solar energy producers were selling electricity at Rs22 per unit, but the government was purchasing it at higher costs and supplying it to consumers at lower rates.
Senator Zarqa Taimur stressed the need to reduce transmission losses and maintain net metering agreements. Leghari warned that failing to implement the revised regulations would shift an additional burden of Rs103 billion onto other consumers.
He also disclosed that the government had exited direct electricity purchases from producers and planned to restructure the National Transmission and Dispatch Company (NTDC) into three separate entities.
Discussions also covered Pakistan’s ongoing negotiations with the International Monetary Fund (IMF) for a three-year energy package. The climate change secretary informed the committee that the State Bank of Pakistan (SBP) was working on financing green energy projects, but Senator Rehman criticised the slow progress, stating that even after five years, authorities continued to claim the SBP was still working on it. She called for loan availability to consumers to facilitate the transition to EVs.
Ministry officials confirmed that the federal government had introduced a special tariff for EV charging stations.
