Master of Business Administration Executive
Faculty / School
Faculty of Business Administration (FBA)
Year of Award
MBA Executive Research Project
Pakistan is currently facing an energy crisis that needs a solution that is multi pronged, something that is actionable in the short, medium and long term.
The purpose of this document was to explore possible avenues for financing solar energy through Microfinance products. A case has been made to explain first and foremost the relationship between Microfinance products and solar energy acquisition for the rural areas as Microfinance traditionally caters to semi urban and rural areas (besides the slums and lower strata of urban areas).
Although acquisition of electricity is ultimately the right of each individual household, Pakistan unfortunately lags behind on this count less due to resource constraint and more due to petty self interests of the personnel in charge at various times.
The urban areas at least have got on grid connections that need a constant supply of electricity to be produced The rural areas though having seen a lot of electrification in recent years still have a long way to go before they join the electrified areas, either due to the distance from the main grid or due to the population in a certain region being so sparse and scattered that it would be expensive to provide the infrastructure required to be connected with the main grid.
Further the need for electricity in these rural areas is limited to the basic lighting at night and charging the cell phone or may be a fan to circulate the air unlike the urban areas where domestic as well as commercial and industrial demand means the urban and rural requirement is altogether at a different paradigm.
This project has hence focused on the needs to provide energy to these areas with an alternate source of energy in the form of solar. There is a realization that other sources of alternate energy too exist such has wind and bio mass but that solar probably at this point in time is not only the cheapest but environmentally cleanest source and hence an attempt is being made to give a solution to the energy crisis in a manner that could be equally applicable to both rural as well as urban areas of Pakistan.
Microfinance loans ensure clean energy lending as no collateral is required like conventional loans, an irritant in the way for people with lack of resources to enhance their social and economic position in society.
The financing model proposed shows it to be a cheaper alternative than kerosene oil; Add the cost of a cleaner environment and the returns are enormous. Wind and solar power can be generated in Pakistan in abundance. It is for the powers that be to actually implement the studies undertaken and the research conducted to at the very least move in the direction of having a clean, environment friendly power generation source channelized to produce electricity with ingredient that is in abundant supply in Pakistan.
Waseem Baig, M. M. (2013). Exploring the avenues of financing solar energy through microfinance products (Unpublished graduate research project). Institute of Business Administration, Pakistan. Retrieved from https://ir.iba.edu.pk/research-projects-emba/449
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