OVER RELIANCE ON THERMAL SOURCES INTENSIFIES THE POWER CRISIS
Nov 29 - Dec 5, 2010
High electricity tariff is not only a matter of concern for electricity consumers but it is also hitting hard to the national industry due to high cost of doing business.
Pakistan is currently facing energy crisis. Circular debt, more reliance on thermal generation, power pilferage, transmission and distribution losses and wastage of energy resources are some of the key issues confronted to the country's power sector.
At present, the country is producing 70-percent of its power from thermal generation. This is really alarming despite the fact that the country was enriched of natural resources. In the past, Pakistan was generating 70-percent of its electricity through hydropower plants and 30-percent from thermal. Now it is opposite and the country is producing 70-percent of its power from thermal generation, which is main reason of high electricity tariff.
The resolution of the country's energy crisis lies on reliance on indigenous energy resources, like hydropower, coal, wind, solar energy.
As per estimates, the total identified potential for hydropower is around 40,000 MW of which only 6400 MW has been exploited so far.
According to experts, coal is a key player in energy market. South Africa, Poland, and China respectively produce 93 percent and 81 percent of the electricity from the coal.
According to them, the total coal reserves of Pakistan are estimated to be around 185 billion tons. The coal reserves in the country for power generation are virtually untapped. Coal can help Pakistan turn around from its current position of energy deficiency to energy prosperity.
They asked the government to follow a multifaceted approach to enhance power generation in the country and tap all resources for power generation including hydel, thermal and coal.
Official sources are of the view that in the last two years, more than1800 MW had been added to national grid with the help of eight IPPs and two rental power projects (RPPs). Four more independent power projects, with capacity of generating 800 megawatts (MW) of power, will be completed by the end of this year to further improve electricity supply in the country.
They said that the government is forced to buy costly electricity from RPPs for five years until such time as long-term cheap power projects come on stream.
According to a latest assessment report, the United States has assessed $21.8 billion financial requirement for Pakistan's energy sector reforms meant to help it add 6950 MW electricity to national grid in the next three years.
As per report, the government of Pakistan needs at least $7.7 billion for completing six thermal power projects on top priority basis and another $14.1 billion investment should come from private sector for streamlining the energy sector of Pakistan. The report said: "Pakistan has to ensure steady implementation of energy sector reforms and fast tracking of investment to overcome its energy crisis. It is a daunting task but not an insurmountable challenge. Pakistan needs full support of its international development partners to have desired level of investment for energy sector reforms and overcome energy crisis in given timeframe of three years."
According to the report, Pakistan's energy crisis was identified five years ago. However, lack of concerted focus on essential institutional and governance principles in energy sector, insufficient maintenances and stilted capacity expansion in the recent years has resulted in serious energy crisis.
With a consumer base over 19.7 million the energy demand reached 20,000 MW during late June and early July this year against an available generation of 15000 to 15500 MW.
Barring WAPDA from thermal power generation and failure to come up with large hydropower projects and growing reliance on thermal power only intensified the power crisis in the country. Strong will and determination is needed to tackle the energy crisis. Nature has gifted Pakistan with a lot of resources. It is up to us to tap these resources for our benefits. Although, this requires time but it is doable. With the support of the government and political will, we can overcome this energy crisis as we have the expertise, manpower, and the right strategy. What is needed is for everyone concerned to put his shoulder to the wheel.
The experts said the government must pay attention to overcome the circular debt, now touching Rs400 billion. The circular debt is essentially the difference in the cost of price of electricity and the price recovered from the consumers. The circular debt can be overcome either by subsidies from the government or by a range of measures including rationalisation of tariff, decrease on dependence of furnace oil, reduction in line losses and elimination of electricity theft. They also called for curtailing the transmission and distribution losses, which stood at 23.7 percent in August 2010. A substantial amount of over 1000 MW electricity can also be saved by implementing meaningful energy conservation and management programme, they insisted.
They said the government must carry out reforms to achieve financial sustainability in the energy sector by recovering cost of electricity, rationalisation of tariff, rehabilitation of old generation units to attain their installed capacities and their conversion from use of oil to coal as fuel.
According to them, more than 3000 MW of power generation can be added by revamping old thermal power plants. This is a far cheaper, quicker, and secure option that needs to be implemented. The reforms should also lay emphasis on increasing efficiency, reduction in line losses and zero tolerance against those involved in electricity theft.
A delegation of Usaid led by Robin Raphel during a meeting with Punjab Chief Minister Muhammad Shahbaz Sharif in Lahore assured cooperation of Usaid for the development of solar energy in the province.
Talking to the Usaid delegation, the Punjab Chief Minister Mohammad Shahbaz Sharif said that Punjab is rich in natural resources which can be developed for generating further resources. He said that Pakistan is facing serious energy crisis which is leaving a negative impact on national development. He said that power can be generated through solar energy in the hot and humid weather of southern Punjab.