Many modern and innovative businesses make the traditional model of the business model for electricity utilities obsolete and may be inadequate to achieve the strategic objectives of my government in the energy sector. The power supply and transmission sector in the country must be refurbished in order to accommodate the emergent new realities in a more competitive, versatile and creative manner. There could be serious and costly consequences not to act quickly and efficiently and also can be very hard to correct at a later stage.
The electrical utility sector has been fundamentally changed by four major developments in the global energy market and the continued sustainability of the traditional approach to that industry raises serious questions.
Four major developments in the global energy market have substantially changed the electricity sector and raise serious concerns as to whether the traditional approach to this business continues to be viable.
In 2018 a new photovoltaic (PV) capacity of 94 GW alone was added to the power sector alone, bringing the total installed global PV capacity to 480 GW, according to a press release from the International Renewable Energy Agency (IRENA). Similarly, a total of 49 GW of new wind power was added to the total of 564 GW during 2018.
In 2018 over USD 11.5 trillion is to be invested globally in renewables between 2018-2050, primarily in solar and wind energy systems, according to New Energy Outlook 2018 from the international research company Bloomberg New Energy Finance (BNEF).
Second, similar advances have allowed residents and other small consumers to opt for photovoltaic systems to meet their electricity requirements, either bypassing local electrical energy systems or using them only as a backup to cover periods when power is either not available or not cost-efficient from their own facilities.
Smaller battery packs prices (mainly used for electric vehicles, EVs, and self-sufficient) have declined to below USD 200 per kWh in 2010. A similar trend has also been pursued by prices of power storage batteries (lithium-ion) since 2012. There is currently a range of research and development projects worldwide, aimed at reducing costs and further increasing the capacity of electricity storage technologies.
Thirdly, fast electric vehicle (EV) inroads in the transportation sector and in particular plug-in hybrid electric vehicles (PHEVs), especially in developed countries, have a substantial impact on the demand for electricity. Only time does it start to enter the markets of developing countries, including Pakistan, in these electrically powered vehicles.
Over the past 5 years or so, in many developed countries and even in some developing countries, particularly China and India, EVs have gone on spectacular routes in the transport sectors. By December 2018, the total stock of EV’s in the world stood about five million, a rise of 58 percent annually, compared to just under 0.5 million in 2013.