Sep 21 - Oct 04, 2009

Oil import bill has not only been eroding Pakistan's foreign exchange reserves but its lofty price has also been a major cause of high inflation in the country. Since crude oil prices are likely to hover around US$70/barrel in the near future developing low cost alternative energy resources is necessary. In this endeavor, prime consideration should be given to indigenous and renewable resources.

Though, it sounds rhetoric yet Pakistan has to exploit its enormous hydropower potentials. The country is capable of producing up to 40,000 MW through hydroelectric power plants and the added advantage would enhance water storage capacity for meeting round the year demand for irrigation water and above all lesser pollution.

To date, the country has established 6,500MW hydel generation facilities. However, due to inadequate water storage facilities dependable capacity reduces to less than one tenth of the installed capacity during certain months. While decades were wasted on discussions on the controversial mega projects, least attention was paid to smaller projects. As a stopgap arrangement, thermal power plants were established, which have attained cumulative capacity of 13,500MW. Most of the upcoming projects are also based on gas and furnace oil. Rental powers are also thermal based mostly using gas.

The second best option is nuclear power. It is not only cheap but Pakistan's accident free track record and support from China offer opportunities for exploiting this resource. It is true that Pakistan faces external pressure but it has to convince all its critics that the nuclear program is for civilian purpose. Being the font line partner in war against terror Pakistan deserves reciprocal treatment. If the US is supplying nuclear technology to India as a compensation for not joining proposed Iran-Pakistan-India gas pipelines, why Pakistan is not compensated for the collateral loses caused due to becoming partner in war against terror.

The next best alternative is power generation from the indigenous coal. Pakistan has millions of tons of coal reserves. Over the years, Pakistan has been able to establish only one small coal-based power plant facing dismal conditions at present. This should be a matter of prime concern for the president and the prime minister that Shaheed Benazir Bhutto performed ground breaking ceremony of a Thar coal based power plant but the project did not become a reality in nearly two decades. The present regime must focus on exploiting Thar coal potential. According to certain estimates Thar coal alone can meet the entire electricity demand for the next 50 years.

Pakistan should also learn a lesson from India in exploiting wind power potential. Lately, India has started producing up to 10,000MW from windmills. India has done this in a brief period mainly by entering into local production of windmills through technology transfer. It is true that it is a rather expensive technology but its operating cost is virtually zero. Pakistan has a coastal line stretching over 1,200 kilometers offering ideal opportunity for installing pollution free electricity generation facilities.

Pakistan is a 'four seasons' country enjoying bright sunshine during most of the year. This provides an excellent opportunity to exploit solar power generation potential. This option is used in areas where establishing electricity transmission and distribution network is too expensive and uneconomical. This option is mainly used in railway signaling system and monitoring oil and gas pipelines in the areas where electricity has not reached as yet.

Academicians talk about more than half a dozen alternate sources of energy which are economically unviable. However, they have been completely ignoring the role sugar industry can play in overcoming shortage of energy products. There are about 80 sugar mills operating in the country. According to some analysts collectively these mills can inject up to 3,000MW in the national grid. These mills offer two added advantages 1) proximity to the point of consumption resulting in lesser transmission and distribution losses and 2) using baggase instead of oil and gas. Sugar mills can also help in containing motor gasoline import bill by joining hands in selling ethanol (a mixture of gasoline and ethyl alcohol). Pakistan can benefit from the experience of Brazil, the largest ethanol using country in the world.

While exploiting other alternative energy resources require extensive capital expenditure, sugar mills offer the most cost effective option for meeting electricity and fuel requirement. Some progress has been achieved but a lot more needs to be done at a much faster pace. Efforts are needed in two key areas 1) offering bulk power purchase tariff equivalent to the one being offered to the IPPs, to the sugar mills and 2) promoting ethanol use by increasing number of outlets selling this environment friendly and cost efficient fuel.

Pakistan should develop its own energy mix rather than blindly following the advice of foreign experts. Foreign consultants promote only those alternatives which can help their own countries in selling equipment etc. Exploring various options is good but selecting economically viable and sustainable option is must. Policy planners should try to develop a mix of available options keeping in view the ground realities.

Adding new generation capacities require capital and time but conserving energy requires no expenditure. A unit of electricity saved is more precious than generating an extra unit. On top of all, consumers have to learn to pay for each unit consumed because utility companies need money to revamp and expand generation, transmission and distribution networks.