Cheaper bank loans are fueling the conversion of tube wells to solar energy
LAHORE: The decision of the State Bank of Pakistan (SBP) to allow commercial banks to provide cheaper loans for the conversion of tubewell operations to solar power to take advantage of the net metering facility, electric distribution companies began to receive an overwhelming response from these consumers across the country.
Under these provisions, connections of tube wells seeking net metering on a load of up to 25 kW will not require permission from the National Electric Power Regulatory Authority (Nepra) to granting a production license, Dawn learned.
The facility will not only convert most of these connections to solar power, but will also allow consumers to generate and use the electricity on their own in addition to selling excess/surplus to the respective Discos. It will also control technical and commercial losses (loss of power due to theft or technical reasons).
“Tubewell connections can be converted to net metering but the response has not been good due to huge investment (around Rs 2-3 million on each connection), lack of loan facility and awareness . Now the SBP has announced a loan facility with a six percent mark-up for starting such small projects,” explained Altaf Qadir, General Manager of Market Implementation and Regulatory Affairs of Lahore Electric Supply Company, during an interview with Dawn.
In addition, the increase in electricity tariff due to fuel price adjustment and other issues has forced consumers with tubewell connections to contact us in this regard,” he said. added.
The net metering project had been launched in 2016 across the country. It allows any domestic, commercial, industrial and other consumer with at least one three-phase meter connection to be part of the electricity generation system by installing it in their premises (house, store, factory, open spaces, etc.) .). According to the agreements, such a consumer can sell the additional energy to the relevant electricity distribution company and make an inventory (calculations) with it at the end of the month.
Since the system allows consumers to generate electricity from one kilowatt to one megawatt, Nepra issues licenses to applicants residing within the service area jurisdiction of all distribution companies. Prior to the issuance of the license, the respective companies are expected to receive, review and process such applications.
According to Mr. Qadir, there are hundreds of thousands of tubewell connections in the service areas of the nine Discos, including Lesco, Faisalabad Electric Supply Company (Fesco), Multan Electric Power Company (Mepco), Gujaranwala Electric Power Company ( Gepco), Islamabad Electric Supply Company (IESCO), Peshawar Electric Supply Company (Pesco), Tribal Area Electric Supply Company (Tesco), Quetta Electric Supply Company (Qesco), Sukkar Electric Power Company (Sepco) and Hyderabad Electric Supply Company (Hesco ).
It can be mentioned that most of these connections exist in a large rural area of Mepco. The number here varies between 60,000 and 70,000. Similarly, Lesco has 25,000 to 30,000 connections and most exist in the areas of its Kasur and Okara circles. Qesco, Gepco, Pesco, Hesco, Sepco and other companies also have a large number of these connections.
Responding to a question, Qadir said Lesco has so far processed up to 6,000 net metering applications, most of which (about 100 MW) have received a generation license issued by Nepra.
Posted in Dawn, March 12, 2022