Energy Crisis in Pakistan
by Aman Hashmi
Electricity is the blessings that science has given to mankind. Throughout the world electricity is widely used and desirable form of energy. It is a basic requirement for economic development and for an adequate standard of living. As a country’s population grows and its economy expands its demand for electrical energy multiplies. It has also become a part of modern life and one cannot think of a world without it.
If this demand is not met adequately a shortage in supply occurs. This shortage can assume crisis proportions. Especially in Pakistan, it has been facing an unprecedented energy crisis since the last several years. The problem becomes severe during the summers. Large numbers of users have to be disconnected from the energy supply system to prevent overloading the generating stations (load shedding). On occasions the urban dwellers had to suffer load shedding of 8-10 hours every day. The present energy crisis is totally due to lack of forecasting and planning.
The major management-related causes of the crisis are:
- Management Information System (MIS) not fully utilized
- Failure to forecast the future threats.
- Failure to set up new generating stations in time
- No new Transmission/Distribution networks & grid stations setup.
- Unexpectedly rapid growth of load.
The role of electricity for farming output and practices is important not just to address constraints on growth but also the growing food shortages in the country. Approximately 50 percent of the population in Pakistan is categorized as food insecure a striking figure in an agricultural economy. One of the primary challenges here concerns inefficient water management in agricultural production. Because, when farmers are prevented from running electric tube-wells to water their fields due to electricity shortages, farming practices and output may continue to suffer water shortages irrespective of efficiency enhancing reforms.
The energy crisis in Pakistan would not have been this difficult to handle but it was made a big problem by following defective policies.
- Circular dept is one of the causes of the crisis.
The question that comes to mind immediately is that what circular dept really is? Circular dept means that the private electricity generation company keeps generating the electricity but they do not get the payment from the government for the power they have provided. Thus, the electricity generating company stops the supply of power after a limited period of time and after that when outstanding amount to be paid by the government crosses the limit; these companies stop the production till they get paid back by the government. This have been happening a lot recently, currently what government is doing is that they let the circular dept build up and while companies stop producing till they are paid back after many months and mean while that close down brings in more shortage and more electricity load shedding afterwards.
What the government of Pakistan is planning is to start developing projects which would include dams and hydral power plants. But the problem that occurs is that it needs expertise and big investments as the shortfall that Pakistan is facing is in range between 3000 MGW to 7000 MGW and the demand is increasing by 9% to 11% per year. The present supply of power that Pakistan can produce easily is 20800 MW which is very less than then what the demand actually is. The actual combined demand from home and industry is approximately between 27000 to 30000 to run country’s economy without disruption. The government has predicted that the demand will increase to 40000 to 50000 MW. Hence, shortfall if conditions remain same will increase to 13000 MW to 18000 MW. This huge deficit is the reason that Pakistan has invited MNE’s to come in Pakistan and invest. The biggest suppliers of electricity in Pakistan are WAPDA and KESC. KESC has to control electricity demand in the industry while WAPDA mainly has the domestic control. Now we must know that what the cost of development is of “HYDRAL POWERPLANT”.
Things that must be evaluated initially are investment cost, operational cost and expected cash flow in first year. In order to meet the needs of electricity in Pakistan the government has come up with a program named “Vision 2020 Program”. In this program they have planned to increase around 20,000 MW into the system. The investment for this program is estimated to be $3.2 billion (USD). Another investment is done by the South Korean Lotte Group. They are installing a $45 million (USD) power plant which will generate 40 MW of electricity. Although this power plant is being installed to reach the energy requirement of the Lotte Pakistan PTA LTD (which is a textile manufacturing company). But they also intend to sell electricity in order to earn profit. According to the research, Access International has also proposed to invest in the power sector of Pakistan in the next five years. This investment would be of around $1.2 billion and would generate approximately 1000 MW of electricity.
LONG TERM SOLUTION
Coal Potential in Pakistan has the 5th largest coal reserve in the World, amounting to approximately 185.175 billion tones. Thar has largest reserve in the country that is approximately 75.5 billion tones. Pakistan can generate more than 100,000 MW of electricity for next 30 years if it uses all coal available to it. At present Pakistan generates only 0.79% of its total electricity from coal [WAPDA Annual report 2007-08]. Coal contributes approximately 39% of the total global primary energy demand. Share of coal in total electricity produced in different countries is
China 81%The policy makers of Pakistan do talk about making dams and setting up nuclear power plants but do not understand the importance and benefits of alternate energy (renewable source of energy) sources such as solar, windmill Tidal, Wave, and Geothermal energy, etc. They are cheap and quick methods for producing electricity. Pakistan is a very blessed country because solar energy is available in most cities all year round. Similarly wind energy is readily available in the coastal areas and in interior Baluchistan during winter. These energy sources if tapped can be of great help in reducing the current demand supply gap.