May 24 - 30, 20

The ruling government is never tired of holding the previous governments responsible for the ongoing load shedding of electricity and gas. However, the current situation can be best described in two words 'bad governance'.

As against an installed generation capacity of 20,000MW, the actual generation has remained nearly half in the past. The shortfall in hydel generation can be attributed to lower levels of water in the dams but the philosophy of running thermal power plants at lower capacity to save fuel shows that the people occupying key position in Ministry of Water and Power and Pakistan Electric Power Company are the worst managers. They are trying to save fuel to cap inter corporate debt but taking hardly any steps to contain electricity pilferage, the mother of all evils.

According to some sector analysts Pakistan is the victim of the changing policies of multilateral financial institutions. In eighties they decided not to extend fresh funds to WAPDA and facilitate creation of independent power producers. They also told the Government of Pakistan to privatise power generation, transmission and distribution entities. As a result HUBCO and a few IPPs were established in the country and KAPCO was privatised. While KESC has been privatised, non of the corporate entities operating under PEPCO could be privatised as yet. Many of the groups having vested interest are resisting privatisation of electric utilities and some are even demanding re-nationalisation of KESC.

The prime reason for the mounting losses of WAPDA and KESC, while operating under the state control, was not the inefficient power generation but colossal transmission and distribution losses. Bulk of these losses is nothing but blatant pilferage of electricity going on for decades with the connivance of the staff of utility companies. Now the state owned distribution companies buy electricity from IPPs at very high price (most of the IPPs are thermal power plants using furnace oil as fuel). Since fuel cost is a 'pass on factor' hike in furnace oil necessitate frequent raises in electricity tariff for the consumers. It is on record that at one time the number of units billed by the KESC were even less than the units generated by the utility. In other words whatever electricity it bought from WAPDA and IPPs went straight towards T&D losses. The T&D loses of distribution companies operating under PEPCO and KESC are close to 40 per cent. Power sector experts say that these losses should not be more than 6 per cent keeping in view the compact operations of these entities and remain losses are nothing but pilferage.

At one time Pakistan was producing 65 per cent of total electricity through hydel plants and remaining 35 per cent at thermal plants. This equation has reversed now as nearly 75 per cent of total electrify is produced at thermal power plants. With the hike in international prices of crude oil, cost of generation has increased manifold. As a result electricity tariff for consumers have also skyrocketed. Out of total installed generation capacity in the country 6,500MW is hydel and remaining 13,500 is thermal. KESC's entire generation is thermal based and contribution of nuclear power plants is minuscule. The country has failed in exploiting its coal as well as wind and solar energy potentials.

There can't be any doubt that nuclear energy is the cheapest but acquiring the technology is most difficult. While the US is providing this technology to India, Pakistan is not being reciprocated despite often termed the frontline partner of the US in war against terror. China has helped in establishing one plant and also signed agreements for establishing two more plants. The second best option is hydel. Pakistan has failed in adding any hydro electric units since completion of Tarbela in 1976. Ghazi-Brotha is run of the river type facility capable of producing around 1,500 MW but actual generation is dependent on availability of water at Tarbella.

Technical experts are of the consensus that Mighty River Indus is capable of producing 40,000MW. It is true that the country needs to add couple of big dams for storing water but run of the river facilities are the best. Such facilities help in containing displacement of people and hardly require construction of mega water storage facilities. Politicians have wasted nearly five decades but failed in developing consensus on construction of Kalabagh Dam. Groups having vested interest have attained political mileage but deprived the country of water storage facility and low cost electricity.

One of the reasons for opposing construction of mega size dams is limited availability of water in the country and high level of distrust among the provinces. However, least attention has been paid on the activities of India resulting in cutting down of water supply to Pakistan. India has been building dams in contravention of Indus Water Treaty and Pakistan has failed in stopping it.

Pakistan needs to add 10,000MW generation capacity over the next ten years to meet the growing electricity demand in the country. While hydel generation is the ideal solution, it also has to exploit coal and wind power potential. Rental power plants do not provide any solution but certainly increase the tariff. To boost GDP growth the uninterrupted supply of electricity has to be guaranteed at affordable cost. The country has the potential which needs to be exploited in the best possible manner.