Reducing the amount of power, water, and raw materials used in industry will help alleviate Pakistan’s crippling energy shortages, conserve natural resources, and increase manufacturing productivity, according to a new study funded by the IFC, a member of the World Bank Group.
The report led by the National Productivity Organisation (NPO) and the Cleaner Production Institute (CPI) found that some industries could save more than one-fifth of their power consumption besides billions of Pakistani rupees by embracing energy-efficient technology. These findings come from an analysis by Ernst and Young of more than 200 resource efficiency audits from manufacturers in the textile, sugar, leather, and pulp and paper industries.
“Implementing energy and water efficiency practices could help save more than $76 million in energy costs, the equivalent of about 25 per cent of the electricity required for the city of Karachi,” said Abdul Ghaffar Khattak, Chief Executive Officer of the NPO, citing the analysis.
Results varied for each industry. For instance, the textile sector, a key foreign currency earner, could save nearly 22 per cent of its total energy consumption by implementing cleaner production technologies. The sugar industry, which places Pakistan among the world’s 10 largest producing nations, could also save at least 1.7 billion Pakistani rupees annually.
But there are challenges. The study highlighted obstacles to improving sustainability in the industrial sector which included weak enforcement of environmental regulations and a lack of financial investment in energy-efficient production. One of the reasons for this is often insufficient awareness about cleaner production technology and its benefits.
“Our work aims to demonstrate the business case for resource efficiency by showcasing the market volume and interest in savings measures,” said Azher Uddin Khan, Chief Executive Officer of the CPI.
IFC, in partnership with the Australian Department of Foreign Affairs and Trade, the Korea Green Growth Partnership, and the Earth Fund Platform, supported the production of this report. It is part of a larger IFC effort to raise awareness about the opportunities and obstacles facing industrial manufacturers.
“By adopting energy and resource efficiency practices, industries can become more efficient and increase their productivity,” said Nadeem Siddiqui, IFC Senior Manager in Pakistan. “Partnering with leading institutions in Pakistan in research like this is an important part of IFC’s strategy”.
The IFC is one of the largest investors in Pakistan’s power sector. Pakistan represents IFC’s second-largest exposure in the Middle East and North Africa region.
