ISLAMABAD: The price of solar panels has plummeted by over sixty per cent in Pakistan in recent weeks due to bulk imports from China because of lower rates, importers said this week, with more consumers switching to the renewable source of power to reduce electricity bills.
The cost of producing solar panels in China, which accounts for about 80 per cent of global consumption, plummeted by 42 per cent in the last year, giving manufacturers there an enormous advantage over rivals in places like the United States and Europe. Multiple European solar manufacturers have announced plans to close factories in recent months, under price pressure from Chinese imports. China accounts for 80 per cent of solar module production capacity after years of subsidies.
Pakistan has ideal climatic conditions for solar power generation, with over nine hours of sunlight in most parts of the country. Utilizing just 0.071 per cent of the country’s area for solar photovoltaic (solar PV) power generation would meet Pakistan’s electricity demand, according to the World Bank.
But currently, only 5.4 per cent of Pakistan’s installed power generation capacity of 39,772 megawatts comes from renewables like wind, solar and biomass, while fossil fuels still make up 63 per cent of the fuel mix, followed by hydropower at 25 per cent, according to the National Electric Power Regulatory Authority (NEPRA).
But this may change with an acute drop in the price of panels, importers said. “A solar plate of 580 watts that I bought [last year] for 75,000 rupees [$270] has dropped to 25,000 rupees [$90] now,” a solar importer in Islamabad said, adding that that means it’s one-third of earlier price.
The rates of the inverters are the same and keep fluctuating, but the main thing is solar panels and the rates of the solar panels are now 33 per cent lower. Prices of solar panels dropped in China following import curtailment from major buyers including India, US and Europe while the Pakistani government had abolished a 17 per cent sales tax to encourage solar imports, the importer said.
Another solar panel importer in Islamabad agreed that the rate drop in China and curtailment of imports to India and other major buyers had led to bulk imports to Pakistan. “America and India have stopped their imports from China, that’s why the majority of the imports are now directed toward Pakistan,” he added.
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