Karachi
Clean Energy Transition
Pakistan is facing significant challenges in shifting to electric vehicles (EVs) amidst chronic power shortages.
The transport sector is one of the most significant global contributors to urban smog and air pollution. The International Energy Agency (IEA) reports that global CO2 emissions from the transport sector reached nearly eight billion tonnes in 2022. According to the United Nations Environment Programme, traditional fossil fuel vehicles account for a quarter of all energy-related greenhouse gas (GHG) emissions. As environmental awareness grows, electric and hybrid automobiles are gaining traction as a viable substitute for such vehicles. As of 2023, nearly 45 million electric vehicles (EVs) were operating globally. Currently, EVs account for 15% of all new car sales, compared to 14% in 2022. Bloomberg forecasts that global EV sales will reach 16.7 million units by the end of 2024. The Global EV Outlook report (2024) projects that passenger EVs will hit 100 million by 2026, with the cumulative sales value reaching USD 8.8 trillion by 2030.
Although Pakistan is one of the least GHG-emitting countries, it is among the most impacted by climate change. In Pakistan, the transportation sector accounts for about 10% of the GDP but generates around 30% of the country’s total carbon emissions. Combustion engines consume 30% of Pakistan’s hydrocarbon imports, costing over USD 15.6 billion annually. In the fiscal year 2022, the transportation sector was Pakistan’s largest consumer of energy products, using approximately 17.4 million tonnes out of the total 23.09 million tonnes consumed.
Despite environmental and economic benefits, EVs are still a rarity on Pakistan’s roads. By 2024, out of 30 million registered automobiles, only 15,000 (0.05%) were EVs. Hybrid electric vehicles (HEVs) make up less than 1% of the light-duty passenger fleet. Multiple factors constrain the growth of the EV sector in Pakistan. The high cost of EVs keeps them out of reach of most people. The lack of charging infrastructure is another hurdle. As per the Business Recorder, there are currently only eight EV charging stations across the country. Without a robust network of charging stations and affordable electricity, many consumers in the country are skeptical about the practicality of EVs.
Recognizing these challenges, Pakistan’s National EV Policy (2019) aims to turn things around. The policy has set the target of 30% of all new vehicles being electric by 2030 and 90% by 2040. It also envisions half a million motorcycles and rickshaws being electric by 2025. These are very ambitious targets, but achieving them would help reduce the high cost of EVs and overcome the lack of charging infrastructure that currently is a barrier to the speedy development of the EV sector.
Electricity is a prerequisite for E-mobility or Electromobility. While EVs promise a cleaner transport sector, free of tailpipe emissions, their benefits depend on the electricity generation source. For EVs to be both environmentally beneficial and economically viable, their batteries must be charged with clean energy to reduce carbon emissions substantially. Ideally, EVs should be powered by renewable energy sources to maximize climate benefits. These include solar and wind energy. However, they depend on the vagaries of weather, such as the availability of wind and sunlight.
Since the electrification of the transport industry depends on energy security, Pakistan is facing significant challenges in shifting to EVs amidst chronic power shortages. Nuclear energy could offer a promising solution in this context. Nuclear Power Plants (NPPs) provide reliable electricity at an affordable cost, which is vital for the reliability of EV charging networks. NPPs are also a carbon-free energy source. Integrating nuclear energy into EV charging infrastructure can significantly reduce the transport sector’s carbon footprint.
Pakistan’s nuclear energy sector plays an important role in the country’s energy mix, contributing around 10% of total electricity generation.
The economic viability of EVs is tied to electricity prices. Power generated by nuclear energy is the second lowest in terms of cost after hydropower. The IEA forecasts that by 2025, electricity generated from NPPs will become more cost-effective than that produced by coal and gas-fired power plants. This is attributed to several factors, including the long-term cost efficiency of nuclear energy, lower operating costs and minimal fuel expenses. Increasing environmental regulations and carbon pricing are also expected to dent the competitiveness of fossil fuels, while advancements in nuclear technology promise to improve efficiency and decrease capital costs.
New trends in the nuclear industry, such as Small Modular Reactors (SMRs), offer innovative solutions for nuclear energy production, which could also cater to the requirements of the EV industry, particularly in developing countries like ours. SMRs are advanced nuclear reactors with outputs of up to 300 MWe. They are smaller in size and operationally less complex than conventional NPPs. Due to their factory-assembled design, SMRs can significantly lower both costs and construction time. Their modular nature makes them suitable for locations lacking infrastructure for large NPPs. This flexibility could support EV charging stations in remote locations.
Pakistan’s nuclear energy sector plays an important role in the country’s energy mix, contributing around 10% of total electricity generation. The country currently operates six NPPs with a total generation capacity of approximately 3,530 MWe. Established in collaboration with China, these NPPs have advanced safety features, ensuring a stable and reliable energy supply. A 1200 MWe NNP is in the initial development phase at Chashma. Pakistan’s Nuclear Energy Vision 2050 aims to expand nuclear energy generation capacity to 44,000 MWe by 2050. Integrating this vision with the National EV Policy could offer a strategic pathway to transform Pakistan’s energy sector and spur the EV industry.
At the global level, China currently leads the automotive industry, producing about 60% of the world’s EVs and over 75% of lithium-ion batteries used in them. Pakistan could benefit by collaborating with China in the EV sector. Chinese automotive giants like Build Your Dreams (BYD) and Great Wall Motors (GWM) are already exploring EV opportunities in Pakistan. In June this year, BYD announced its plan to establish an EV assembly plant in Karachi’s Port Qasim in partnership with Hubco, Pakistan’s largest private electricity producer. BYD plans to sell 100,000 EVs annually by 2030. Hubco intends to leverage its power generation network to develop EV charging infrastructure nationwide. Furthermore, the Chinese investment firm ADM Group plans to invest USD 250 million in two EV projects focused on charging networks and manufacturing facilities in Pakistan. This collaboration can encourage local manufacturing and create job opportunities nationwide.
Notably, China is the only country in the world cooperating with Pakistan in the production of nuclear energy. As China is also emerging as a major investor in the EV sector, installing MRVs at critical points in collaboration with China could be a game changer in ensuring the availability of affordable electricity for EV charging stations.
The writer is a research officer associated with the Center for International Strategic Studies, Sindh. She can be reached at irajabid@cisss.org.pk
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