20. Oktober 2014 | The Alliuris Group has supported a research project as a master thesis about energy law. The thesis was written by Arslan Chaudry, a young lawyer from Pakistan during his master studies at Bucerius Law School in Hamburg, Germany. The studies were – during an internship – supported by Herfurth & Partner in Hanover. Here is the key information as an abstract:
Developing economies like Iran, Pakistan and India rely heavily on conventional sources for energy generation and given the volatile nature of the energy market (i.e. oil, gas and coal) this trend is unsustainable in the long run. Thus for the energy security and to cater the ever increasing energy demands of the growing economies, renewable energy sector offers immense potential. RE sector is also important for Iran since the trade restrictions do not impact the RET’s. These countries are blessed with abundant renewable energy resources for instance; exploitable wind energy potential, according to the figures quoted by IEA ( International Energy Agency), stands at, Pakistan 50.000 MW, India 40.000 MW and Iran 4500 MW. With an average of 300 sunny days and an annual solar irradiance in between 1600-2200 km², solar energy sector also offers very attractive investment opportunities. Many pioneer projects are being initiated and promoted by these countries in the wind, solar and biomass energy sectors. Pakistan recently launched one of the largest solar project in the world i.e. Quaid-e-Azam solar Park (1500 MW) with no local content requirement, which has gained much attention world-wide and a promising business opportunity.
In order to further support and develop this RE sector at a fast pace, the role of FDI has been duly acknowledged and various demand pull policies where incentives in terms of feed-in tariffs, preferential treatment, grid access, guaranteed purchase of electricity, no-license requirements and tax exemptions are few of the many incentives that are well in place. The legal institutions are very developed and the foreign investment is well protected. In comparison to India and Iran, Pakistan has the most liberal approach towards the repatriation of profits, exemptions on custom duties, tax relief and there are no foreign investment caps.
With this unparalleled renewable energy potential, competitive incentives and established legal institutions, private investment in the renewable energy sector of Pakistan, India and Iran is well protected and can be a very lucrative opportunity for foreign Investors.