June 11 - 17, 2012

Out of total installed capacity of 22,477 megawatt, last year only 94,383 gigawatt hours of electricity was produced in Pakistan indicating a dispatch factor of 48 per cent, according to the Energy Year Book 2011. The dispatch factor of water and power development authority (Wapda) owned power plants were 32.9 per cent while that of independent power producers (IPPs) stood at 50.8 per cent, Karachi electric supply company (KESC) 45.9 per cent, nuclear 49.6 per cent, and hydel plants 56 per cent.

Above statistics clearly show these plants were not fully utilized. Preposterously, the government officials are giving impression that load shedding is due to less installed capacity. These plants can operate up to 70 per cent dispatch factor easily but due to non-availability of money, it is not happening.

In 2011, oil fired thermal plants produced 33,186 GWh. Of that, 23,687 GWh were produced by IPPs, 6,896 GWh by Wapda-owned plants and 2,603 GWh by KESC plants. For the production of this electricity, 8,138,956 tons of oil was consumed, which implies 245.25 gm of oil was consumed for production of each electricity unit (kWh).

The present cost of furnace oil is around Rs85,000 per ton that means each unit cost 20.85 rupees for fuel only. The burning of oil is also generating the green house gasses that are causing damage to environment. Last year, the oil-fired power plants produced 16 million tons of CO2.

The data also disclosed that out of total production of 94,383 GWh, only 77,099 GWh were supplied to the customers and 15,315 GWh were declared as transmission and distribution losses that are actually the electricity theft. Total cost of this theft was Rs319.26 billion.

By these figures, it is very clear that why circular debt is escalating despite regular bailout packages by the government. Approximately, electricity of one billion rupees is lost or theft daily in our country.

Allah has blessed Pakistan with great potential of wind, solar, coal and hydropower. A survey carried out by national renewable energy laboratory, USA in collaboration with USAID has indicated a potential of 346,000 MW of wind power in Pakistan, according to alternative energy development board (AEDB). A report published by Wapda in November 2011 states Pakistan has potential of 100,000 MW of hydropower with identified sites of 59,000 MW. Similarly, potential of solar power is still untapped. Pakistan possesses the world's 5th largest coal reserves, although coal is not a green fuel but it's almost three times cheaper than imported furnace oil.

In the recently unveiled budget, Rs183 billion was announced for subsidy to electricity but it looks that subsidy will be almost doubled the budgeted amount. The government uses the subsidy in form of bailout package for the purchase of imported fuel. It is surprising that why the subsidy is not utilized to reduce the cost of production by converting existing plants to cheaper fuel (coal, biomass) and installing new renewable energy plants.

If the subsidy amount of Rs183 billion is used as equity for the projects of reducing electricity production cost, Rs732 billion can be borrowed to make 80:20 debts to equity ratio projects. Total amount will be Rs915 billion rupees. Conversion of existing plants to coal or biomass will cost one million US dollar per MW and installation cost of new plant will be $1.5 million per MW. New plants of 4,300 MW and conversion of existing oil-fired plant of 3,500 MW can be done by Rs915 billion.

Cost of each unit produced through coal would be seven rupee that will generate a saving of Rs13.85 rupees per unit. These coal-converted plants can generate 16,556 GWh at 60 per cent dispatch factor. Total saving of fuel would be Rs229 billion and additional capacity payment (insurance, equity and loan repayment) would cost Rs62.6 billion per year.

Similarly, newly installed wind plants will be able to generate 10,848 GWh at 30 per cent dispatch factor. The total fuel saving would be Rs193 billion when considering an operating cost of three rupees per unit. The additional capacity payment required for these would be Rs115.4 billion per year.

Total saving by both of these projects will be Rs244 billion and reduction in oil import would be equal to Rs422 billion ($4.6 billion) per year. If government uses the subsidy intelligently for the infrastructure improvement rather than buying oil, the load shedding and circular debt issue can be resolved in only one year.


World Environment Day (WED) is celebrated on 5th June every year around the world. It is a day that promotes awareness about the environment and enhances political attention and public action. The first WED was held in 1973.

This year environment day is celebrated with the theme of "Green Economy: Does it include you?" According to the definition of UNEP, a green economy is 'one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.

Green economy can only be achieved if we utilize the energy efficiently and also at right place. Energy conservation is also required along with energy efficiency. Normally, when we talk about energy conservation, it assumes to save the electricity. But, the energy conservation covers saving of all kind of energy including oil, water and other resources.

Here we will discuss the effect of using public transport instead of private vehicles. It helps the environment, saves energy, and reduces congestion on roads. Public transport is necessary for those who cannot operate the personal vehicles due to low income, and old age. Public transport is beneficial to meet the friends and have chat during the journey.

When fuel burns, it generates green house gasses that are damaging to our environment. The most commonly emitted green house gas is carbon dioxide. The each liter of petrol burnt produces 2.34 Kg of CO2 while that of diesel produces 2.68 Kg of CO2.

Daily thousands of people in Pakistan travel in their own cars to their offices, schools, and colleges. Normally, a car covers a 15 km in a liter while a mini bus covers four km in a liter.

The car carrying four persons for a 15 Km journey consumes one liter petrol and produces 2.35 Kg of CO2 that means each person consumes 0.25 liter petrol and generates 0.59 Kg CO2.

Similarly, a mini bus carrying twenty passengers for 15 Km journey consumes 3.75 liter diesel and produces 10.05 Kg of CO2 that shows each person consumes 0.19 liter diesel and generates 0.50 Kg of CO2. So, by travelling on public transport, each person can save 0.004 liter of petrol on each Km. When calculated for the whole country, oil of billions can be saved by adopting public transport setup.

The issue in Pakistan is that public transport is not adequately available; busses are not available at time and for right routes. Air conditioned buses are not available for the so called gentry, that's why they used to travel by their own cars. This is in contrast to developed economies where people used to travel on public transport usually. The governments should focus on developing the strong and reliable public transport setup.

By the use of public transport, congestion will definitely reduce. Most of the cars are used by a single driver while a bus that can substitute these cars can take 20 to 25 persons. The effective public transport can reduce emissions by thousands of cars from roads. This not only reduces congestion but also reduces the repair and maintenance cost of roads.

The writer is an MBA and chemical engineer and working for an IPP.