Solar tubewells — a double-edged sword

Over the last three years, Pakistan’s agriculture sector has witnessed two important developments.
The electricity tariff for agricultural tube wells, including taxes and charges, has skyrocketed from Rs11 to Rs44 per unit kilowatt-hour (kWh), while the cost of solar panels has plummeted from Rs130 to Rs35 per watt. These changes have accelerated the widespread adoption of solar-powered tubewells across the country.
Contrary to expectations, the federal budget 2024 maintained tax exemptions on the imports of solar panels, while essential products like pharmaceuticals, infant formula, and other food items were subjected to an 18 per cent sales tax. As a result, the prices of solar panels have continued to decline since the budget’s announcement, which has further quickened the transition.
With the recent price reduction, converting an existing tube well to solar power now costs approximately Rs0.75 million to Rs2m for a 10 to 30-kilowatt system. While this remains a considerable investment for small and medium-sized farmers, the steep rise in electricity tariffs has shortened its payback period to just two to two and a half years, making it a highly attractive option for farmers.
This transition to solar energy is not only justified but also commendable as it provides a clean and sustainable alternative to diesel-powered tubewells and grid electricity, which is predominantly generated from fossil fuels like coal, gas, or diesel — the largest contributors to global warming and climate change. Additionally, this shift will help reduce fuel imports, which is crucial for addressing Pakistan’s massive trade deficit.
Solar-powered tube wells have provided much-needed relief to farmers by considerably lowering crop production costs, as irrigation remains one of the major cost elements, particularly for rice, sugarcane, and maize (corn). This reduction comes at a critical juncture when farmers are struggling with the skyrocketing costs of agricultural inputs, adverse impacts of erratic rainfalls and severe heatwaves and downward-trending international crop prices.
On the flip side, environmentalists argue that the growing solarisation of tube wells, which offer cost-free irrigation, could lead to indiscriminate groundwater extraction. With solarisation, farmers have no incentive to use water wisely or to invest in water conservation technologies.
Environmentalists’ concerns are not unfounded, as the area under rice cultivation — a water-guzzling crop that consumes around 4,500 litres of water to produce 1kg of rice — has expanded by 22.2pc in just one year. The cost-free availability of groundwater, made possible by solarisation, has been a key catalyst for this expansion, alongside several other contributing factors.
Such rapid expansion of rice cultivation is outpacing the availability of surface water, which is steadily declining due to sediment build-up in dams. This alarming trend is underscored by data, showing a reduction from 101.1 million acre feet (MAF) in 2016-17 to 72.7 MAF in 2022-23 (Pakistan Economic Survey 2022-23).
As a result, reliance on groundwater extraction is escalating. In Punjab province alone, 1.3m tube wells are operational, leading to groundwater overexploitation — aquifers’ extraction rate surpasses the natural recharge rate. This causes a persistent decline in the water table and deterioration in groundwater quality, both of which have become serious concerns.
This situation has evoked opposition from various groups, including environmentalists, against the government-backed solarisation of agricultural tube wells. However, it is essential to recognise that technological innovations and scientific advancements are inexorable forces.
While it is true that every technology comes with potential downsides alongside its countless benefits, halting its adoption solely because of these drawbacks is not a productive approach. The best option is to promote new technology to harness its benefits on a larger scale, while simultaneously regulating it to minimise adverse effects.
In Pakistan, groundwater pumping remains entirely unregulated, with no restrictions on the installation of a tube well, the size of the borehole, or the volume of water extracted. This unrestricted access allows anyone to pump groundwater at will.
In contrast, many countries have undertaken regulatory interventions to ensure the sustainable use of precious natural resources. It is time for Pakistan to follow suit and implement regulations to conserve its groundwater resources for future generations.
Four key interventions are deemed essential to address this critical issue. First, a licensing system for tube wells must be introduced, where the size of the borehole is appropriately matched to the size of the farm, considering factors such as the agro-climatic zone, cropping pattern of the area, local water table, and the availability of surface water.
Second, it is imperative to implement a system where farmers using solar-powered tube wells are charged based on the volume of groundwater they extract, measured through the installation of volumetric meters. The water charges should be carefully calibrated — not so high as to unduly burden already struggling farmers, but not so low as to diminish the perceived value of this critical resource. The Punjab Irrigation Department already holds comprehensive data on tube wells across Punjab, which could serve as a stepping stone for this initiative.
Third, the solarisation of tube wells should be made conditional with the adoption of high-efficiency irrigation solutions such as drip, sprinkler, rain gun, centre pivot systems, etc. These technologies need to be offered as bundled products under government-sponsored tube well solarisation initiatives, typically supported by subsidies or subsidised loans.
Fourth, in rural areas, farm-level interventions are imperative to artificially recharge the aquifers through rainwater harvesting, using both surface methods (infiltration systems) and deep underground systems (injection methods). This would not only improve the water table but also help alleviate floods exacerbated by rainwater.
Given the ever-increasing burden of implicit and explicit taxes on agricultural inputs, produce, and income, the proposed tax on solar-powered tube wells should not be directed to the government exchequer. Instead, it should be allocated to a dedicated fund, managed by academia and farmers’ associations, with the specific aim of expanding groundwater recharge initiatives.
Khalid Wattoo is a farmer and a development professional, and Sara Mehmood is a researcher in climate change, environmental sciences, and forestry.
Published in Dawn, The Business and Finance Weekly, August 19th, 2024