TITLE;

WHAT IS THE SOLAR ENERGY POLICY OF SCANDINAVIAN COUNTRIES FOR HOUSE

HOLD/DOMESTIC USE AND HOW TO ENCOURAGE DOMESTIC CONSUMER OF PAKISTAN TO USE

SOLAR ENERGY AS AN ALTERNATE SOURCE
Abbreviations:
RES - Renewable Energy Resources, PV Photovoltaic, CSP Concentrated Solar Power

Energy from Sun

The sun is a sphere of intensely hot gaseous matter with a diameter of 1.39 x 10 9 m and
is, on the average, 1.5 x 10 11 m from the earth [1]. Its radiant power comes from nuclear
fusion processes, during which the sun loses 4.3 million tones of mass each second.
This mass is converted into radiant energy. Each square meter of the suns surface
emits a radiant power of 63.1 MW, which means that just a fifth of a square kilometer of
the suns surface emits an amount of energy equal to the global primary energy demand
on our planet [2]. The earth receives more energy from the Sun in just one hour than the
world's population uses in a whole year.

Solar Power
Solar power is the conversion of sunlight into electricity, either directly using
photovoltaic (PV), or indirectly using concentrated solar power. All solar thermal
systems capture the energy of the sun by absorbing light as heat. Solar thermal power
systems focus sunlight, usually with mirrors, to heat a fluid to high temperatures and
drive a steam engine. This approach stands in contrast to photovoltaic solar power
systems, in which light interacts with special materials directly to separate charges and
generate electricity. This phenomenon is called Photoelectric effect.

Solar Potential in Pakistan

Pakistan lies in a region of high solar irradiance and is ideally suited for solar energy
projects. Pakistan receives about 15.5x1014 kWh of solar irradiance each year with
most regions receiving approximately 8 to 10 sunlight hours per day [3]. On average
solar global isolation of 57 kWh/m 2/day exists in the country over more than 95% of its
area with persistence factor of over 85% [4]. Especially Baluchistan, Sindh, and

southern Punjab receive abundant solar radiation on the order of over 2 MWh/m 2 and
3,000 hours of sunshine a year, which is at the highest end of global isolation averages
[5]. According to the Pakistan Energy Book 2004-05, solar energy falling on 0.25%
Baluchistan province would be adequate to meet the current requirement of the country
with 20% efficient devices [6].

Figure 1.1 Solar Isolation map of Pakistan

Status of Solar Energy Use in Pakistan

During last fifteen years Pakistan has shown quite encouraging developments in
photovoltaic (PV). The National Institute of Silicon Technology (NIST) under the Ministry
of Science and Technology has developed the know-how and technology to fabricate
solar cells, modules, and systems. [5]
Both photovoltaic and solar thermal technologies have the potential for vast application
in Pakistan, though the scale of utilization so far has been smaller. Solar energy has
been utilized in Pakistan for about a quarter of a century. In early 1980s eighteen PV
stations (440 KW) in different parts of the country were set up for village electrification.
Because of lack of technical know-how and follow up, these systems have not
performed as required. Now NIST has developed the know-how and technologies and

basic infrastructure in the field. Currently solar technology is being used, in Pakistan, for
stand alone rural telephone exchanges, repeater stations, highway emergency
telephones, refrigeration for vaccine and medicines in the hospitals etc. The Public
Health Department has installed about 20 solar water pumps for drinking purposes in
different parts of Baluchistan [5].
Alternate

Energy

Development

Board

(AEDB)

electrified

approximately

3000

households with total PV power generation of 200 kW in districts of Kohat (NWFP), D.G.
Khan, Rawalpindi (Punjab), Tharparkar (Sindh), Turbat/Kalat (Baluchistan), etc. while
providing 80W panel with lighting system to each household. Pakistan Council of
Renewable Energy Technology (PCRET) electrified more than 500 schools, mosques,
houses through PV power with total generation capacity of more than 80 kW [4].
In

solar

thermal

side,

solar

cookers

(box

and

concentrated

type),

solar

dryers/desalination units, solar water heaters, etc. have been designed, developed and
are in limited use but their contribution in energy provision is negligibly small. So the
total installation appears to be much less than 1000 kW in PV and 10,000 solar thermal
units (all kind) in the country. [4]

Scandinavian or Nordic Countries

Scandinavia is a large region of Northern Europe that is mainly made up of the
Scandinavian Peninsula. Geographically, the Scandinavia is the largest peninsula in
Europe and it extends from above the Arctic Circle at 66.5N latitude south to the North
and Baltic Seas. The countries included in Scandinavia are:

Sweden
Denmark
Norway
Finland
Iceland

The Scandinavian countries are also known as Nordic countries.

Figure 1.2 Map of Scandinavian Countries

Sweden
Sweden plans to be World's first oil-free economy by 2020 [7]. Mandatory targets set by
the Directive on the promotion of the use of energy from renewable energy resources
are [7]:

49% share of Renewable Energy on the final consumption of energy by year

2020.
At least 10% share of Renewable Energy in final consumption of energy in

transport by year 2020.

60 % Share of Renewable Energy on gross electricity consumption by year 2010.

Support Schemes for RE in Sweden

The Kingdom of Sweden promotes renewable electricity through a quota system, tax
regulation mechanisms and a subsidy scheme [8]. In Sweden, tax exemptions are the
main incentives to support renewable heating. The main incentive for renewable energy
use in transport is a tax exemption for bio-fuels. The use of solar energy for household
purpose is supported by the Investment subsidy policy of Sweden. The costs arising
from the subsidy are borne by the state. The national budget provides the national

energy agency with a total of 350 m SEK to allocate subsidies for a period of five years
[7]. The following Table gives the support policy of Sweden for domestic use of solar
energy.

Resource

Support Level
% / investment

Comments

70% of the cost of the

Solar PV

Solar Thermal

installation may be refunded

(with a maximum of 50000
SEK/building).
maximum subsidy of 800 for

Solar Thermal
All REs

a one family house

30% of its costs covered
Tax Rebates
30% of the cost of installing

All RE technologies

those technologies- Credit to

For public buildings

For installations in houses

For public buildings

the tax account

Table 1.1 RE Policy of Sweden for the use of Solar Energy [7]

Denmark
Denmark has been self reliant on energy since 19991 [9]. The country has the lowest
energy consumption per unit of GDP in EU and highest contribution to electricity from
renewable resources in the EU. Mandatory targets set by the Directive on the promotion
of the use of energy from renewable energy resources are [9]:

30% share of Renewable Energy Sources (RES) on the final consumption of

energy by year 2020.

At least 10% share of renewable energy in final consumption of energy in

transport by year 2020.

29 % share of RES in gross electricity consumption by year 2010.

Support Schemes for RE in Denmark

In Denmark, electricity from renewable sources is mainly promoted through a premium
tariff and net-metering [10]. Renewable energy sources for heating purposes are

exempt from the tax obligations on the production, supply and use of energy sources.
Access of electricity from renewable energy sources to the grid shall be granted
according to the principle of non-discrimination. With regard to the use of the grid,
renewable energy shall be given priority [10]. The support policy of Denmark for
domestic use of solar energy is as follows:

Fixed feed-in tariffs and premium

The support is given in the form of premium and or as a fixed feed in tariff, so that the
combination of market price and supplement ensures a fixed tariff for the producer. All
subsidies are passed on to the consumers as an equal Public Service Obligation (PSO)
tariff on their total consumptions [9].

Resource
Solar PV
Solar Heating

Support Level
% / investment
8 cents/kWh
Exempt from CO2 & Energy

Comments
Feed-in tariff

Tax

Table 1.2 RE Policy of Denmark for the use of Solar Energy [9]

Fiscal incentives
Solar cell systems with an effect of less than 6 kW connected via consumption
installations in households are exempt from electricity levies [9].

Norway
Norway has set itself an ambitious target to reduce global greenhouse gas emissions by
30% of Norwegian 1990 levels by 2020 and to become carbonneutral by 2050 [11].
Norway is a heavy producer of renewable energy due to good resources in hydropower.
Over 99% of the electricity production in mainland Norway is covered by hydropower
plants. Norway has limited resources in solar energy, but is one of the world's largest
producers of solar grade silicon and silicon solar cells [12].

Support Schemes for RE in Norway

The Kingdom of Norway promotes renewable energy through a quota system including
a certificate trading scheme [13]. The support policy of Norway for domestic use of solar
energy is as follows:

Energy Efficient Buildings - Legislation

The building code is the main legal instrument for improving Renewable energy use in
house hold. According to this code, a minimum of 40% of energy for heating and hot
water in new and refurbished buildings must be provided by energy carriers other than
electricity and/or fossil fuels. Typical solutions include district heating, local heating
systems, heat pumps, solar heaters, pelletbased systems and wood stoves [11].

Investment Support
Since 2006, the Govt. of Norway also manages a household support scheme, which
helps individuals who invest in renewable heating systems or energysaving products.
The scheme includes support to pellet stoves, pellet boilers, control systems, solar
water heating systems and heat pumps [11].

Finland
Bio-energy plays an important role in the de-centralized and diversified Finnish energy
system. Finland is one of the world leaders in utilizing bio-energy. Almost 20 % of total
primary energy consumption in Finland is met by bio-energy. Finland policy framework
for bio-energy has been very effective; however other RES with still potential in Finland
are less developed. Additional support in the form of feed-in tariffs based on purchase
obligations or green certificates is being considered for onshore wind power. [14]
Through subsidies and energy tax exemptions, Finland encourages investment in RESelectricity and RE-Heating & Cooling. Mandatory targets set by the Directive on the
Promotion of the use of energy from renewable sources

38% share of RES on the final consumption of energy by year 2020.

At least 10% share of renewable energy in final consumption of energy in

transport by year 2020.

31.5 % Share of RES on gross electricity consumption by year 2010.

Support Schemes for RE in Finland

In Finland, electricity from renewable energy sources is mainly promoted through a

premium tariff. Additionally, investments in RES are supported through state subsidies.
The main support mechanism for heat produced from RES, is a heat bonus allocated
to Combined Heat & Power plants working on biogas and wood fuel. In transport, the
main incentive for renewable energy use is a quota system [15]. The support policy of
Finland for domestic use of solar energy is as follows:

Investment Subsidies
The installation costs of solar PV plants are co-financed by the government with grants
of up to 40% [14].

Fiscal Incentives
Taxes imposed on heat, are calculated on the basis of the net carbon emissions of the
input fuels and are zero for renewable energy sources [14].

Iceland
Iceland has abundant renewable energy resources. Its policy is to make the fullest use
of these resources in a sustainable manner. Today nearly all of Icelands electricity and
space heating is provided by renewable sources, i.e. hydropower and geothermal
energy. About 85 percent of total primary energy supply in Iceland is derived from
domestically produced renewable energy sources. In 2011, geothermal energy provided
about 65 percent of primary energy, the share of hydropower was 20 percent, and the
share of fossil fuels (mainly oil products for the transport sector) was 15 percent. In
2013, Iceland also became a producer of wind energy [16].

Support Schemes for RE in Iceland

In Iceland, the generation of electricity from renewable energy sources is promoted by
subsidies granted for the design and construction of original tools and equipment for
research on and the exploitation of energy resources as well as for special projects in
the field of economical energy use [17]. No specific support schemes for domestic use
of solar energy exist in Iceland [18].

Encouraging Domestic Consumer s of Pakistan to use Solar

Power as an alternate resource

1. Offering Subsidies
Installing solar cells on rooftops is very expensive. Factories, businesses, and homes
can't afford to spend so much. It would make more sense to buy a generator than to
install solar panels. Even if solar panels save more money in the long run, people are
turned away by the high upfront costs. One way to address this problem is by offering
subsidies. This would reduce the upfront costs and make the long run benefits stand out
more.

2. Exemption on custom & excise duty

Exemption of custom and excise duty on specific goods for the installation of solar
energy will significantly reduce the cost for solar energy. Projects cost between 10%20% less because of these tax exemptions. Developing countries financially improve
their chance of developing solar when the cost is reduced.

3. Competition in solar market

Completion of the 1000 MW Solar PV project in 2016 will pave a way forward for other
investors because the technology can be implemented in a very short time and will
provide high rates of return. Because the solar market will be strong, there will be
competition as companies fight for projects. Competition would decrease prices and
increase quality. Pakistan should still not charge any taxes on solar in this phase as it
will be creating a strong market. Once a healthy market is created for solar, solar energy
will become more popular. Companies would be willing to sell and install individual solar
panels as well as large scale solar projects. A strong solar market would increase the
popularity of solar cells as various kinds and qualities become available. At this point,
the government should highly subsidize solar keeping in mind the end user as the
poverty rate of Pakistan is quite high. With greater popularity and a decreased price,
people will begin to see the long term savings solar energy brings. Businesses,
factories, and homes would be more willing to install solar cells.

4. Incentives to solar energy consumers

Specials incentives should be given to solar energy users. Incentives may include
reduction in income or property taxes.

5. Purchase of energy from consumers

One of the immediate steps that the Government of Pakistan can take to bring relief to
the small commercial and residential consumer is the implementation of net-metering
for all independent solar energy installations. Net-metering is widely used policy in
which allows consumers to feed (export) excess electricity generated by their individual
solar systems to the utility grid and draw (import) electricity from the grid for their usage.
In this model, each net-metered solar energy sells and buy electricity to and from the
same utility company multiple time each year. The end result is that consumer pay only
for the net usage for the complete billing cycle.

References
[1]

Solar Engineering of Thermal Processes, 3rd Edition, Duffy, J.A. and Beckman,
W.A., 2005. New York, USA.

[2]

Technology Fundamentals - The Sun as an Energy Resources published in

Renewable Energy World 05/2003 pp. 90-93

[3]

Renewable Energy for Managing Energy Crisis in Pakistan, Harijan, Khanji,

Muhammad Aslam Uqaili, and Mujeebuddin Memon. Jamshoro: Springer Berlin
Heidelberg, 2008.

[4]

Renewable and Sustainable Energy Reviews, Energy and renewable energy

scenario of Pakistan Munawar A. Sheikh, 2009 Journal of Science Direct.

[5]

ENERGY POTENTIAL OF PAKISTAN, Dr. S. R. Malik, M. A. Maqbool, NFC

Institute of Engineering and Fertilizer Research, Faisalabad.

[6]

Pakistan, Renewable Energy Report, Asian and Pacific Centre for Transfer of
Technology of the United Nations Economic and Social Commission for Asia
and the Pacific (ESCAP),

[7]

RENEWABLE ENERGY POLICY REVIEW - SWEDEN, www.iea.org

[8]

LEGAL SOURCES ON RENEWABLE ENERGY, http://www.res-legal.eu/searchby-country/sweden/

[9]

RENEWABLE ENERGY POLICY REVIEW - DENMARK, www.iea.org

[10]

LEGAL SOURCES ON RENEWABLE ENERGY, http://www.res-legal.eu/searchby-country/denmark/

[11]

Energy Policies of IEA Countries Norway

[12]

Renewable energy in Norway, www.wikipedia.com

[13]

LEGAL SOURCES ON RENEWABLE ENERGY, http://www.res-legal.eu/searchby-country/norway/

[14]

RENEWABLE ENERGY POLICY REVIEW FINLAND

[15]

LEGAL SOURCES ON RENEWABLE ENERGY, http://www.res-legal.eu/searchby-country/finland/

[16]

Renewable energy in Iceland, www.wikipedia.com

[17]

LEGAL SOURCES ON RENEWABLE ENERGY, http://www.res-legal.eu/searchby-country/iceland/

[18] Support schemes for renewable energy in the Nordic countries - An

introduction.