Degree

Master of Business Administration Executive

Faculty / School

School of Business Studies (SBS)

Year of Award

2023

Advisor/Supervisor

Dr. Mohsin Sadaqat, Assistant Professor and Head of Finance Lab, Department of Finance, Institute of Business Administration (IBA), Karachi

Project Type

MBA Executive Research Project

Access Type

Open Access

Executive Summary

The purpose of this research is to identify the factors driving the decision of potential customers in installing a solar power system in Karachi. Pakistan is currently facing an energy crisis along with economic instability leading to highest inflation rates of all times. Subsequently, the people are looking at alternatives to mitigate the inflation effects and reduce the dependency on the electricity grid, which is not only expensive but also unreliable. Solar power system is an alternative that is highly popular and has the potential to resolve these issues.

The research used interviews to collect data from customers who had already installed solar power systems at their residences to identify the factors. These interviews also brought the opportunity to understand the challenges and advantages of the solar power systems that the customers experienced firsthand. The analysis produced six decision factors that are considered by the customers when going for a solar power system installation.

It was also important to understand and test these factors with a wider audience. For this reason, data from residents of Karachi was collected using a survey questionnaire to gauge the relative importance of the identified decision factors. Out of the six factors, the top three factors were high energy bills, load shedding and energy independence.

The research also included development of a financial model that can be used in real- life scenarios for decision making on the basis of financial metrics such as payback, return on investment and internal rate of return. The model takes various economic and technical inputs into consideration and outputs a detailed sensitivity analysis that allows the customers to base their decisions on.

Based on the combined knowledge gained from this research, it is recommended that policy making should be done by the government to allow easy access to the solar power systems to the common people, especially those who belong to the lower socio-economic classes. Adequate policies cannot only support the national grid by reducing the burden on it but can also help in alleviating poverty, fight inflation, and boost the overall economic conditions of the country.

Pages

xi, 87

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