Pakistan is seeking to add 5,770 megawatts of electricity to its national grid by 2018 as the energy crisis been faced by the country is overdue, which has obstructed growth and forced many factories to close. Pakistan currently produces about 15,886MW against the demand of 19,500MW, leaving the gap of over 3,500MW. The shortages rise to nearly 6,000MW during peak summer season. International donors estimate energy shortage, including gas shortages, undercut between 1 to 2 percent of GDP every year.
Due to rooted energy shortfall, Pakistan’s textile sector takes the most hit which accounts for over 50 percent of the country’s exports. In the oil sector, there is no major capacity addition lined up for 2018 except for laying of a pipeline for transportation of petroleum products to reduce reliance on road network.
To attain self-sufficiency, alternative energy resources are being delved into around the globe. There are about 929 billion tons of coal reserves whose 40 percent is used to produce the electricity.
As per estimation, third biggest coal reserve of 185 billion ton exists in Pakistan which is equivalent to 400 billion barrels of oil. Pakistan coal reserves are equivalent to Saudi Arabia and Iran’s combined oil reserves. Governments have taken appropriate actions to produce electricity from Thar coal. Thar coal is highly shaky, which cannot be treated to convert it to energy on earth surface temperature.
Same characteristics and nature of coal also exits in Australia which is being process beneath earth to extract energy, government can take expertise from Australian government in this regards to utilize Thar coal.
Support from USA, China for coal-based energy
The United States is helping Pakistan to address its energy problem. The US-Pakistan Clean Energy Partnership is building on the country’s existing energy resources, including hydro, natural gas, wind, solar, geothermal and biomass. According to latest research, oil and gas reserves will be worn out into the second half of this century. Sindh Government has contracted with a multi-national firm and work has been started.
Beside this, agreements inked in CPEC (China-Pakistan Economic Corridor) China will build or help to construct 21 power plants, which will be mainly fuelled by coal. These power generating projects will save huge foreign exchange, which is used up on the import of furnace oil. The second largest oil producing country Iran too is producing electricity from coal. China, itself is producing 75 percent electricity from coal and is ready to help us produce electricity with coal.
World electricity production from gas is 19 percent while in Pakistan natural gas contributes to produces 29 percent of total, nuclear energy’s share in world total energy is 16 percent while in Pakistan is only 2 percent, while furnace oil contributes 7 percent to total world electricity generation but in Pakistan it add up 35 percent to total electricity production.
Poland and Germany produces 43 percent and 80 percent of electricity from coal respectively.
Countries like South Africa 93 percent, India 78.3 percent, Australia 77 percent, China 72 percent, America 49 percent, and Denmark 47.3 percent and UK 32.9 percent respectively produces electricity from coal.
Pakistan’s wind potential
An important and natural resource of alternative energy is wind. Wind energy is of importance as it does not create any environmental pollution at all. Minimum of 13 km/hr wind speed is supposed to be sufficient for converting wind energy to electrical energy through wind turbines.
Germany produces 18000MW, USA produces 7000MW, and Spain produces 8000MW from wind energy. Pakistan have potential places for wind energy like coastal areas of Karachi, Thatta, Jiwani, Balochistan’s coastal belt, northern areas and Azad Kashmir.
Solar energy prospective
Solar energy is one of the cheapest and important ways to harvest energy. The energy received from the sun in one hour is more than the world’s total produced energy in a year. If only half percent of Sahara desert land is used for solar energy (Photovoltaic) it would cater the energy demand for the entire world.
Pakistan has much potential for solar energy because Pakistan is receiving 19 mega joules per square meter in a year through which 90 percent of rural area can be energized.
Nuclear and gas energy benefits
Nuclear energy is most sophisticated and advance source to attain energy but on other hand it is most reliable and sustainable source as well. Pakistan is producing only 600MW electricity from nuclear resources which is only 2 percent of our total energy production. Nations with atomic technology are utilizing nuclear energy to its maximum capacity.
Pakistan natural gas reserves are declining rapidly so therefore, it is necessary to revive the energy mix and produce electricity by means of alternative resources.
By utilizing only 50 percent of alternative energy resources available Pakistan can export the additional energy to neighbor states. With induction of fresh gas and electricity supplies, the major constraint of industrial and business sectors would stand removed.
The government would enter the New Year, and an election year on top, with a decision for an almost 25-30 percent increase in average consumer-end electricity tariff.
With induction of fresh supplies, a major industrial and business sector constraint will stand removed.
For solar and wind, the government would hold competitive bidding with a cap of 400MW and 600MW respectively for the next year. Despite the fact that large power projects on imported fuels, particularly LNG and coal, would continue to be operated to ensure their economic viability at the cost of foreign exchange.
The government would need to keep pace with changing LNG prices after having entered into long term supply contracts with Qatar, Gunvor and ENI at a higher base.
At the close of 2017, the government is estimated to have added around 6,000MW to the generation capacity since it came to power in 2013 and was able to deliver about 19,000MW to consumers in peak summer of 2017.
About 4,000MW of electricity generation is estimated will be added during 2018 with completion of three LNG projects of 1,200-1,300MW each (total 3,600MW) in Punjab besides the 1,400MW Tarbela fourth extension, 969MW Neelum-Jhelum Hydropower project and completion of Port Qasim Coal based project of 1,320MW among the major sources. The LNG projects at Balloki, Bhikki and Haveli Bahadurshah are currently running at half capacity.
With completion of the second LNG processing terminal that puts total gas imports at 1.2 billion cubic feet per day (BCFD) against a decade long gap of about 2BCFD.
Because of higher LNG imports, the dependence on furnace oil would come down significantly, from about 9.5 million tonnes per annum to somewhere between 6 -7 million tonnes during the year, down by almost 30 percent.
With induction of almost 4,000MW during 2018, the power sector is poised to touch generation capacity of around 25,000MW to breakeven demand, without any spinning reserve to adjust for emergency breakdown, from less than 15,000MW about five years ago.
At the end of the year, the country would be entering an era of capacity trap unless the economy enters the much desired 7-8 percent growth rate per annum.