Energizing Insurance: Fueling Pakistan’s Energy Ambitions with Innovation and Support

March 8, 2024
2 mins read

TLDR:

  • Insurance companies are gearing up to play a key role in Pakistan’s burgeoning energy sector.
  • Pakistan aims to derive 60% of its energy from clean and renewable sources by 2030.

In a bid to capitalize on Pakistan’s burgeoning energy sector, both global and local insurance companies are gearing up to play a pivotal role. The sector is poised to witness an influx of billions of dollars in investments, spanning renewable and conventional power projects, over the next few years. Industry experts, speaking at the recent Energy Summit titled “Fostering Growth, Collaboration, and Resilience in Pakistan’s Energy Mix,” shed light on the significant role insurance plays in fostering the development and sustainability of the country’s energy landscape.

During the summit, distinguished speakers from leading insurance firms and energy companies shared insights into the evolving energy scenario in Pakistan. Among the notable attendees were Ata Khatib, Chairman of Lockton MENA; Dr. Jason Shirley, General Manager at ECP Energy and Chemical Professionals; Phil Pavey, Senior Underwriter at GCube Insurance Services; and Pavel Chernoverkhskiy, Chief Underwriting Officer at Zurich Insurance Company. Additionally, Khurram Ali Khan, CEO of Fidelity Insurance Brokers, joined other industry stalwarts representing Independent Power Producers (IPPs) within Pakistan, Oil and Gas regulators, and accomplished insurance experts.

According to statements made at the summit, Pakistan is witnessing the development of several hydropower projects, including Bunji (7,100 MW), Diamer Basha (4,500 MW) in Gilgit-Baltistan, Thakot (4,866 MW), and Dasu (4,320 MW) in Khyber Pakhtunkhwa. These projects align with the government’s policy objectives, which encompass universal energy access, a substantial increase in renewable energy share, and enhanced energy efficiency and conservation.

Notably, Pakistan aims to derive 60% of its energy from clean and renewable sources by 2030, leveraging its significant solar and wind power potential, estimated at over 40,000 megawatts. Furthermore, the nation targets electrifying 30% of its vehicle fleet by the same year. Industry experts emphasized the pivotal role of Sustainable Development Goal 7 (SDG 7), advocating for universal access to clean and sustainable energy. They stressed that achieving SDG 7 is crucial for advancing progress across all 17 Sustainable Development Goals and addressing climate objectives effectively.

These ambitious energy projects in Pakistan are receiving funding from public coffers and various financing agencies. Moreover, international interest in Pakistan’s energy sector is on the rise, with countries such as China and the Kingdom of Saudi Arabia leading the charge. China’s commitment includes the construction of the Chashma-5 nuclear power plant, touted as the largest civil nuclear power project, with a capacity of 1,200 megawatts. Valued at a minimum of $3.5 billion, the project is slated for completion by 2030. Meanwhile, the Kingdom of Saudi Arabia is set to invest $4.5 billion in renewable energy projects, totaling 500 megawatts in Baluchistan, alongside a colossal $10 billion investment in a mega oil refinery in Gwadar.

The convergence of global expertise in insurance and the influx of investment in Pakistan’s energy sector heralds a new era of growth and sustainability. As the nation strives to diversify its energy mix and embrace cleaner technologies, insurance firms stand poised to play a pivotal role in mitigating risks and safeguarding investments, thereby fostering a resilient energy ecosystem for Pakistan’s future.

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