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Energy Crises in Pakistan

• Energy is important for every country to be alive. Energy consumption per capita is a key indicator of the quality of work life of the citizens
• In Pakistan energy gap has increased from 3500 MW in 2008 to 5,000 MW I October 2009
• Per capita energy consumption in Pakistan is only 15 MBTU as compared to 54 in China, 104 in Malaysia and 106 in Iran.
• Our trade deficit is roughly about 9.34 % of GDP in 2007-08 fiscal year, shortfall of electricity is one of the main factors
• Our Oil imports increased by 56 % and food imports increased by 46 % in fiscal 2008
• In this current situation with the demand increasing day by day, Pakistan cannot increase its dependence on furnace oil.

Causes of Energy Crises

• No major project undertaken by previous government: No big project was launched in Musharaff regime. Generation capacity also declined. As installed generation capacity had increased by 53 % in 1994 to 1999. (11320 MW to 17400MW) but it increased only 12 % in 1999 to 2007, 19420 MW. Even this increase was due to completion of Ghazi Brotha project which was started before Musharaff in 1990s.
• Failure to increase the generating capacity: Hydel electricity generation goes down by 60 % in winter naturally but the generation from thermal plants has also declined by 4000 MW which generated 5000 MW shortfall.
• Problem of Circular Debt: in 2007 government did not have money to pay the subsidy amount to the electricity companies due to its debts. This problem became more serious when oil prices jumped up from $100 to $147 per barrel in international market.
• Losses in Transmission and Distribution: In Pakistan the losses are over 20 % compared to 8 to 10% in other countries.
• Wastage of Energy: Industry sector uses 30 % of electricity while they can generate solar energy like China. Transport sector uses 28 % of total energy due to its poorly tuned engines.
• Domestic and Household consumption: This consumption is more then estimated as well. Now this sector uses 45 % of total electricity

Effects of Energy Crises

• Less exports due to shortfall
• Unemployment
• Many industries closed
• In 19500 MW, about 60 % are from imported oil or domestic natural gases. While only 3o % is generated by thermal plants. This reduces our foreign reserves

Solutions

• Resolving the Circular Debt Problem: Any payable amount to oil companies, Wapda, pepco or any other company should be paid on priority basis so that they can work on full efficiency.
• Building smaller Power Plants: New projects have been identified but not implemented. Some of them are a) addition of rental power plants (950 MW), b) new IPP thermal project (375 MW), c) Rehablitation of WAPDA power plants (2oo MW), d) loss reduction (80 MW). Capital cost of project should also be considered. Capital cost of 1500 MW of new plant considered to be $3 billion. On completion more electricity at price of 12 to 14 Rs per unit can be added but will not be affordable.
• New Gas Power Plants: new plants should be installed and existing should be updated. As they produce only 70 % of power as new one do.
• Update the system of transmission and Distribution
• Maga Dams: In coming 5 years hydel-thermal electricity generating capacity should be 60:40 to tackle the problem on the long run. Kalabagh dam controversy makes the situation more worse. Some non controversial projects are being delayed as well like Neelum Jehlum (969 MW), Tarbela extension (960), Suki Kinara (840), Khan dabbar (130), Allai (126) and Jinnah Hydro (96 MW).
• Autonomy to WAPDA to undertake new projects
• Exploit the coal reserves: Thar has one of the largest deposits of coal in the world. To use this will reduce dependence on imported energy. China has offered project in 2005 to generate 3000 MW at 5.8 % but it could not move forward as they were offered only 5.3 %
• Regional Gas and Oil Pipelines: Iran-Pakistan-India gas line, Turkmenistan-Afghanistan-Pakistan gas pipeline can be considered. It will not only reduce the cost of energy but attract foreign financing.
• Alternative sources of energy: wind power, solar energy, bio fuel can be used as alternative energy sources.

(1 MBTU mean 1 Million British Thermal Unit, 3134 MBPTU = 1 Kilowatt hour)
(Source: World Times Magazine December 2009)