AS energy shortages and prices have become major factors behind pathetic economic conditions of both the individual families and the country, Prime Minister Shehbaz Sharif has termed future energy planning critical to Pakistan’s future. He was chairing a meeting on energy security in the backdrop of an energy crisis looming large due to the Gulf war and the faulty energy planning that could not withstand the pressure of a few weeks.
It is highly deplorable that our planners and decision-makers miserably failed to visualize growing energy requirements of the country and take concrete measures to ensure sustained supply of affordable electricity and gas to the masses and different sectors of the economy. It is because of lack of necessary vision that despite massive surplus of generation capacity, outages of electricity and gas are assuming dangerous dimensions with far reaching impact on daily routine and commercial, economic and agricultural activities. The country is currently facing a worsening electricity crisis, as the overall power shortfall reached 6,500 megawatts (MW), leading to prolonged load-shedding in several regions and mounting public frustration. According to official estimates, the national electricity shortfall has ranged between 4,500 and 6,500MW in recent days, depending on demand levels.
The defective planning is evident from the fact that until recently the government was discouraging any meaningful expansion in generation capacity citing surplus already achieved and the so-called under-utilization. However, this surplus is, for all practical purposes, meant to benefit Independent Power Producers (IPPs), which are receiving hundreds of billions of rupees for their idle capacity and that too at a time when the country needs to jack up supply in the face of substantial increase in summer-related demand. Who is to be blamed for doling out undue incentives to IPPs despite availability of best of the models elsewhere in the world? And now again, we are told that Pakistan will require between 62,660MW and 70,720MW of additional power generation capacity by 2035 to support projected economic growth of 3.5 to 6.4 percent.
The revised Indicative Generation Capacity Expansion Plan (IGCEP) 2025-35, prepared by the Independent System and Market Operator in consultation with the National Electric Power Regulatory Authority (NEPRA) and other stakeholders, outlines a 10-year roadmap for expanding generation and transmission infrastructure across the national grid, including K-Electric. The plan includes significant additions across technologies, including 21,400MW of hydropower, up to 13,200MW of solar and as much as 11,500MW of wind capacity, depending on the growth scenario. It also incorporates 8,224MW of RLNG, 4,730MW of nuclear and smaller contributions from local coal, gas and bagasse-based plants. In fact, solar alone has the potential to take care of the domestic and economic demands of electricity but unfortunately the government initially provided liberal incentives for adoption of solar technology but then its own ministry took a series of measures to discourage its growth. The reversal of net-metering policy inflicted a major blow to the rapid growth of solar power and now the government has come out with the novel idea of paid license for individual power producers, which has generated strong reaction in the length and breadth of the country because it further confirms the impression that the government is milking power consumers in every respect.
The exploitative slab system and unjustified and exorbitant fixed charges (besides a variety of taxes and surcharges) have pushed the actual price of a unit of electricity beyond Rs. 100. The prices are set to increase further in coming months as a result of an understanding with the International Monetary Fund (IMF). There is also a growing impression that the government is using the IMF shield to justify its anti-consumer and bitter anti-people measures. The faulty planning is once again highlighted by latest reports of power outages in Gwadar and that too when the country needed uninterrupted power for port operations, which are gathering momentum because of regional dynamics. At this critical juncture, it has dawned upon our planners that the port city’s heavy reliance on electricity imports from Iran has resulted in frequent outages and rising energy security risks. A report submitted by the Independent System and Market Operator (ISMO) to the National Electric Power Regulatory Authority (NEPRA) describes Gwadar’s existing supply arrangements as “unreliable and operationally vulnerable,” citing repeated disruptions in cross-border electricity flows, proposing a 40MW dedicated power plant for the city but it is understood this will take some time to materialize. Here, the planners are again erring by suggesting a localized plant of the capacity of 40MW, which will not be in a position to take care of growing demand of the city.
Some of the measures being proposed or taken by the government will hopefully help improve the energy scenario. Two pilot projects for battery storage at the grid level are being developed under the PC-I plan, while domestic consumers producing solar energy were being encouraged to install battery storage. The Prime Minister has directed that a plan should be developed to facilitate the acquisition of batteries for storing surplus electricity generated from solar energy and efforts should be made to encourage the local production of high-quality storage batteries. He also instructed that only electric buses and motorcycles be purchased for government use in the future. He also stated that faster steps should be taken to establish charging stations for electric vehicles (EVs). It has also been announced that the government employees up to Grade 16 would be provided with electric bikes on easy installments.
The aggressive campaigns aimed at promotion of electrical vehicles and high quality solar storage batteries are no doubt steps in the right direction as their adoption will lead to significant reduction in the import of oil and the load-shedding. However, in the absence of clear cut and unambiguous policies and plans, these moves might end up the way we experienced the tragic fate of campaigns aimed at popularization of CNG kits. Genuine relief for consumers is not possible without a satisfactory solution to the chronic issues of capacity payments to IPPs, which is one of the major causes of circular debt and rising electricity tariff. Similarly, any increase in generation capacity will lose its significance in the absence of a reliable transmission system. Therefore, we need to plan and execute projects for upgradation and expansion of the transmission system on war footing and this should not be a problem when, according to reports, Saudi and Chinese are ready to make necessary investments.
