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More coal-based projects can help Pakistan meet energy demand

Use of coal is playing a vital role in the electricity generation globally. Coal-fired power plants fuel 41 percent of worldwide electricity while in some states these projects generate higher percentage of electricity. Worldwide coal consumption looks set to peak, as the continuing reform of China’s economy causes growth in its demand for coal (energy) to slow sharply, although China’s coal consumption is predicted to broadly plateau over the next 20 years, in sharp contrast to the rapid, industrialization-fuelled growth of much of the past 20 years.

Growth in worldwide coal demand slows sharply relative to the past (0.2% p.a. versus 2.7% p.a. over the past 20 years); international coal consumption will peak in the mid-2020s. Electricity, biofuels, coal and natural gas together account for 13 percent of transport fuel demand in 2035, up from 7 percent during 2015.

Furthermore, India is the largest growth market, with its share of global coal demand doubling from almost 10 percent during 2015 to 20 percent during 2035. Over two-thirds of India raised demand for coal is predicted to feed into the energy sector.

Coal consumption in the OECD-member nations’ declines by over 40 percent as the share of coal within the power sector is crowded out by renewables and natural gas.

According to the ‘Global Trends in Renewable Energy Investment 2016’ report, during 2015, renewable energy set new records for investment. The report adds that investments stood almost $286 billion and for the first time, greater than half of all added power generation capacity came from renewable resources.

Hence, the latest worldwide trends for environmentally safe and secure future, Pakistan must fully exploit the country’s potential in renewable energy resources. Unluckily, Pakistan has been reeling from a severe power shortage over the previous few years. The condition has predominantly worsened since 2006: this is mainly on account of insufficient capacity addition, limited exploration and ineffective exploitation of coal, hydro and renewable potential and inefficient use of power resources.

During times of acute need, mainly in the summer, the overall shortfall in electricity stands 7,000MW. The deficit has a detrimental effect on the economy, causing a predicted 4-7 percent loss to Pakistan’s GDP.

 

The Government of Pakistan, in its Vision 2025 policy, urged that it aims to remove the present electricity demand-supply gap by 2018 and cater to the rising future demand by adding 25,000MW by 2025. It is also said that early harvest projects under CPEC (China-Pakistan Economic Corridor) would add 10,400MW of energy to the national grid by 2018. If this target is achieved, it would decline load shedding in Pakistan considerably and would reduce the chronic electricity shortfall.

Almost all energy projects to be completed under CPEC reveals that there are a total of 24 projects with a potential of 17,045MW of energy production. Another important feature of CPEC energy projects, as envisioned by the government, is to enhance the energy mix with a larger share of coal, hydel and renewable energy sources.

Coal may be a feasible option for a short to medium-term planning, but because of the hazards it poses on the environment, it should not be a long-term viable energy policy.

The country has an enormous amount of untapped coal reserves (almost 186 billion tones) and the government intends to raise local coal production from 4.5 to 60 million tons yearly. Keeping in view the environmental concerns of carbon dioxide emissions associated with coal-based thermal power projects, the present government is committed to adopting clean coal combustion technologies along with strong strategies to make their use eco-friendly and to conform to global standards.

Although Pakistan aims to exponentially grow its coal consumption with Chinese assistance and technology, the irony is that China has set a target of declining its yearly coal capacity by 800 million tons. Presently work on two coal-based power plants of 330MW each is underway at Thar Coal Field. The power plants are being organized by Sindh Engro Coal Mining Company with the cooperation of Sindh Government under CPEC. It is said that the projects costing Rs2 billion would be completed by December 2018.

The Government of Pakistan has also restored the capacity of a coal-fired power project in Hub, Balochistan, to 1,320MW after the Chinese firm that was developing the project reportedly took up the matter at the highest level.

No doubt, coal-based power projects will decline the supply-demand gap in Pakistan; these would certainly have quite harmful effects on the environment in the long run.

The government’s plan to accelerate local coal production from 4.5 to 60 million tons yearly stands in stark contrast with worldwide trends at a time when the world is turning to more and more renewable forms of energy.

Pakistan sincerely must think of coal only as a short-term solution so that long-term results of environmental degradation can be avoided.

PAKISTAN: COMMERCIAL ENERGY SUPPLIES BY COAL
Fiscal Year
Coal Imports (000 tons)
Production (000 tons)
2000-01
950
3,095
2001-02
1,081
3,328
2002-03
1,578
3,312
2003-04
2,789
3,275
2004-05
3,307
4,587
2005-06
2,843
4,871
2006-07
4,251
3,643
2007-08
5,987
4,124
2008-09
4,652
3,738
2009-10
4,658
3,481
2010-11
4,267
3,450
2011-12
4,057
3,613
2012-13
3,710
3,179
2013-14 (P)
3,119
3,438
2014-15
5,004
3,712
JUL-MAR
2014-15 (e)
3,928
2,500
2015-16
3,733
1,111

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