Achieving Universal Electricity Access in Pakistan by 2030: A Comprehensive Roadmap

The World Bank's Least-Cost Electrification Study for Pakistan aims to achieve universal electricity access by 2030 through a mix of grid densification, grid extension, mini-grids, and off-grid systems, with a total projected investment of $13.3 billion. The study emphasizes the critical role of mini-grids, especially in remote areas, and highlights the potential for private-sector involvement to reduce the financial burden on public entities.

The World Bank's Least-Cost Electrification Study for Pakistan outlines a comprehensive plan to achieve universal electricity access by 2030, blending grid expansion with off-grid solutions. Conducted over two years, this study uses a geospatial model to identify cost-effective methods for electrifying four provinces: Balochistan, Khyber Pakhtunkhwa, Punjab, and Sindh. The goal is to serve approximately 40 million new electricity connections, addressing both current lack of access and future population growth.

Grid Densification: A Cost-Effective Solution

Grid densification emerges as the least costly option for about 53% of new connections, particularly for those within 500 meters of the existing grid. This involves strengthening the existing infrastructure to formally connect households that might already have informal or illegal connections. For the 9.3 million new connections located beyond 500 meters, grid extension is the preferred solution for 25% of the total, especially in densely populated areas. However, in remote and sparsely populated regions, mini-grids and individual off-grid systems become more viable. Mini-grids, primarily solar-powered, are optimal for about 20% of new connections, particularly in Khyber Pakhtunkhwa due to its geographic and demographic characteristics. Individual off-grid systems, mainly solar home systems, are suitable for only 2.5% of new connections.

The Critical Role of Mini-Grids

The study emphasizes the critical role of mini-grids in Pakistan's electrification strategy, especially for remote locations. The Mini-Grid Portfolio Readiness Assessment identified over 1,000 high-priority sites for mini-grid development across the four provinces. Implementing mini-grids in these areas could significantly accelerate universal electricity access, with an estimated investment of 360 million dollars. Financially, the total investment needed to achieve universal electricity access in the four provinces is projected at 13.3 billion dollars. Currently, this financial burden falls predominantly on public-sector entities, as most distribution companies are publicly owned. However, the study suggests strong potential for private-sector involvement, particularly in mini-grids and individual off-grid systems, which could alleviate the financial burden on public entities.

Balancing Costs and Reliability

The study also includes sensitivity analyses for districts like Tharparkar and Abbottabad, highlighting how factors such as grid reliability and energy costs influence the cost-effectiveness of grid extension versus off-grid solutions. Higher grid reliability and demand favor grid extension, while higher grid energy costs make off-grid solutions more attractive. The study concludes with several recommendations for implementing the least-cost electrification plan. These include designating a lead entity to coordinate efforts, training utility companies to utilize geospatial tools, piloting and prioritizing off-grid solutions, and making the GIS-based platform publicly available to attract private investment. Aligning these efforts with national policies and local needs is crucial for achieving Pakistan's electrification goals.

Addressing Current Electrification Challenges

The study reveals that Pakistan's current electrification rate stands at 89.2%, with an additional 8.5% using smaller off-grid systems. However, about 10% of grid-connected households have informal connections, indicating a need for formalization and grid strengthening. Reliability, affordability, and availability of electricity are major challenges, with many distribution companies struggling to raise capital for improvements. The 18th Amendment to Pakistan's constitution in 2010 has increased provincial roles in developing mini-grids and off-grid projects, with varying levels of success across regions.

The study's methodology includes data gathering, geospatial analysis, and the use of the Reference Electrification Model (REM) to determine the least-cost mix of grid and off-grid electrification technologies. Key inputs include population growth projections, electrification rates, and the cost of various electrification modes. For grid extension, the CAPEX includes network costs such as wires, transformers, poles, and accessories, while for off-grid systems, it covers solar setups and distribution networks. The study projects that Balochistan, for instance, will need over 2.6 million electricity service connections by 2030, with a current electrification rate of 25%. The province's challenging geography and low population density make off-grid solutions particularly relevant. Similarly, Khyber Pakhtunkhwa's rugged terrain and demographic characteristics favor mini-grids as the most economical solution for many new connections. In Punjab and Sindh, the higher population densities and existing grid infrastructure make grid extension and densification more feasible.

The study also emphasizes the importance of integrating both grid and off-grid solutions to achieve universal electricity access efficiently. This integrated approach not only provides energy access but also supports local economic development by enabling access to reliable electricity for businesses, schools, and health centers. By leveraging local renewable energy sources and reducing reliance on the main grid, off-grid solutions can enhance energy security and sustainability. The study underscores the need for a coordinated effort involving federal and provincial governments, distribution companies, and the private sector to implement the least-cost electrification plan effectively.