electricity problem in pakistan essay

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What’s at Stake in Pakistan’s Power Crisis

By Noah Berman

February 6, 2023 3:00 pm (EST)

Worsening blackouts are the latest manifestation of Pakistan’s economic distress. A brewing debt crisis could plunge the country into financial chaos.

A wave of darkness engulfed Pakistan on January 24 as its aging power grid strained to meet the country's demand for electricity. The massive outage was the latest in a series of blackouts that have become a chronic symptom of Pakistan’s ailing and climate-vulnerable economy, under duress from devastating natural disasters, a colossal debt load, and the mounting risk of sovereign default. With Islamabad rushing to negotiate a bailout from the International Monetary Fund (IMF), experts fear the response will not be enough to avoid a crisis.

What caused the January power outages?

Local officials blamed a surge in voltage at a power station in Sindh Province that cascaded throughout the country, bringing down the grid and leaving more than two hundred million people without power for nearly a day.

A street vendor cooks by headlamp as the darkness encroaches on the background.

Such blackouts are becoming increasingly common. Analysts say the electricity grid, established prior to Pakistan’s 1947 independence and largely constructed in the 1960s, is suffering from a dangerous lack of maintenance and investment. Pakistan is also running low on the imported fossil fuels that power the grid, with prices skyrocketing since the Russian invasion of Ukraine began.

Energy and Climate Security

International Monetary Fund (IMF)

“Given how rickety and dilapidated the electricity grid is, and the associated infrastructure, it doesn’t take all that much to deliver a catastrophic shock to the system,” says Michael Kugelman, a South Asia expert at the Wilson Center.

What’s at stake if the power outages continue?

Pakistan’s electricity woes have added to the country’s precarious financial dilemma, with the blackout inflicting an estimated $70 million loss to the country’s textile industry, its largest export sector by a wide margin. Meanwhile, Islamabad’s total national debt had soared to over $200 billion [PDF] by late 2022, amounting to roughly 90 percent of its gross domestic product (GDP), according to state bank statistics. A series of compounding factors have shaken Pakistan’s economy: double-digit inflation has made everyday goods such as food and fuel more expensive, and interest rate hikes by the U.S. Federal Reserve and other central banks have resulted in rapid devaluation of Pakistan’s currency, the rupee. Meanwhile, an estimated $40 billion in damage caused by last year’s catastrophic flooding , a budget deficit worsened by large government subsidies, and an unforgiving debt load have brought the country to the precipice of default.

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Last week’s blackout aggravated this economic adversity. Extended power outages could also affect Pakistan’s agriculture industry and force the country to import more food, a troubling prospect given that the prices of staples such as grain and vegetable oil have soared in the past year. Though Pakistan has been a net importer of food for much of the past three decades , its reliance on food imports surged last summer, when floods destroyed millions of hectares of farmland.

“If these power outages and these broader electricity problems continue over time, you’re going to see major deleterious implications for the economy, both right away and further down the road,” Kugelman says.

What do Pakistan’s struggles mean for other countries?

An economic crisis in Pakistan could have implications for Islamabad’s close relationships with Washington and Beijing. Meanwhile, its growing climate disruptions could ring alarm bells for other vulnerable countries.

Beijing has invested over $60 billion in the country via its Belt and Road Initiative (BRI), through both debt and equity financing; Pakistan has borrowed $30 billion from Chinese lenders. While China has already reduced its lending to Pakistan, analysts say a sustained crisis could make Beijing wary of investing more money in the country. And default in another BRI country—Sri Lanka and Ghana both defaulted in 2022—could resurface other lenders’ concerns about China’s notorious reluctance to take losses on its loans. Pakistan borrowed more from China than Sri Lanka or Ghana did, so another round of contentious debt negotiations could raise questions about Beijing’s leverage over countries that owe it money. A default could also give pause to other countries considering Chinese investment.

“Chinese state banks have been acting like most commercial creditors—they seem determined to get their money back with interest as quickly as possible,” says CFR’s Brad Setser.

The United States has sought to bolster Pakistan as a stable partner in a region stricken by terrorism and violence, providing tens of billions of dollars in military aid and other assistance over the past two decades. With Pakistan and other climate-vulnerable countries suffering increasingly severe economic consequences from climate change, many experts say what’s needed now is aid tied to climate adaptation. However, some of them argue that the $200 million Washington has provided to Islamabad since summer 2022 barely registers in terms of Pakistan’s need. That paucity of aid could portend lackluster financial support from wealthy nations for climate adaptation policies in other low-income and climate-vulnerable countries.

Will an IMF bailout stave off an economic crisis?

Pakistan hopes to forestall default by unlocking a paused $1.1 billion disbursement from the International Monetary Fund, the world’s controversial financial firefighter . Islamabad has implemented a series of reforms aimed at complying with the lender’s conditions, including hiking fuel prices and instituting a market-based exchange rate for the rupee. The funding is part of a $7 billion bailout that Pakistan and the IMF agreed to in 2019, their fifth such deal in the past two decades.

What would be coming from the IMF would be a drop in the bucket.

IMF conditions have often proved unpopular in Pakistan, and Prime Minister Imran Khan imposed subsidies that derailed the country’s IMF program before he was ousted from office last year. With the rupee falling to an all time low, imports, especially fuel, have become much more expensive, and officials worry about how the country’s forty-six million poor people will survive the spike in prices.

But even Khan has now said the country has “no choice” but to negotiate with the IMF. To stay afloat, Pakistan has drained its foreign reserves: as of early February, the country’s remaining $3.7 billion in central bank reserves were enough for only three weeks of imports. Meanwhile, double-digit inflation has made looming debt payments increasingly out of reach.

Even so, some analysts say that the proposed bailout would be little more than a band-aid solution given the country’s massive debt burden and debilitating underinvestment in electricity and other infrastructure.

“If you’re looking at the scale of the financial needs within the electricity sector, and the broader energy sector, what would be coming from the IMF would be a drop in the bucket in terms of what’s needed more broadly,” Kugelman says.

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ISSI Publications Articles

Issue Brief on “Pakistan’s Energy Crisis: The Need for a Transition to Alternate Energy”

Like many other developing countries, Pakistan has been grappling with a severe energy crisis for several years. The demand for energy continues to surge due to population growth, urbanization, and industrialization, while the supply of conventional energy sources remains inadequate. This energy deficit has led to frequent power outages, hampering economic growth, disrupting daily life, and impeding technological progress. In this context, the adoption of alternative energy sources presents a compelling solution to address Pakistan’s energy crisis. [1] Pakistan’s energy crisis is a long-standing and multifaceted issue that has significantly impeded the country’s economic growth and development. Pakistan witnessed acute energy crisis during the summer months from May-August 2023. The electricity shortfall widened to 7,000 megawatts with demand rising to 28,200 megawatts, while the power supply was 21,200 megawatts. [2]

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Interview from the Energy Security Program

Pakistan's energy insecurity anatomy of a crisis and how to move forward.

According to the World Bank, one in three people in Pakistan does not have access to electricity. The shortcomings of the country’s energy system have led to profoundly negative impacts on public health and well-being, as well as to a rise in energy-related civil unrest. With energy demand expected to quadruple over the next twenty years, numerous specialists have argued that Pakistan must take action now to effectively strengthen its energy security outlook. However, the country continues to face ongoing questions about how to muster the political will necessary to move forward.

To better understand these issues, NBR spoke with Michael Kugelman, Senior Associate for South Asia at the Wilson Center and editor of a newly released study Pakistan’s Interminable Energy Crisis: Is There Any Way Out? In this interview, he discusses how Pakistan’s energy problems have become a full-scale crisis and proposes near- and long-term reform strategies.

What is the nature and origin of Pakistan’s energy crisis?

This is a far-reaching crisis that affects millions of people on multiple levels. Above all, it has major economic implications: power shortages have cost Pakistan up to 4% of GDP in recent years, hundreds of factories have shut down because they lack power, and some Western companies have pulled out of Pakistan because of this electricity scarcity. Many Pakistanis have lost their jobs because of power outages. The crisis also aggravates a volatile security situation because separatist insurgents in Baluchistan, along with the Taliban, regularly attack electricity infrastructure and plunge large areas of the country into darkness.

Society on the whole is affected as well: Gas shortages have left many people unable to cook, while some hospitals have had to cut back on services for the sick due to insufficient power. In June 2015, we saw all too tragically the direct and deleterious impact that the crisis has on the masses. Over just a few days, more than 1,200 people died in a heatwave. Many became sick after suffering inside homes that didn’t have electricity and therefore couldn’t operate fans or air conditioning. Given this sad state of affairs, it is not surprising at all that people regularly stage protests against Pakistan’s government and its electricity utilities. Some of these demonstrations are quite violent, with attacks on the homes and offices of politicians.

What makes this all so troubling is that it’s not shortages of energy alone that define the crisis—shortages of governance of energy are really what has gotten Pakistan into this mess. Authorities simply don’t manage existing resources well. They have failed to address transmission and distribution (T&D) losses—which often approach 20%—and to repair dilapidated infrastructure. Islamabad has also failed to deal with the financial debt encumbering the energy sector, which is compounded by an unsustainable energy mix that emphasizes expensive hydrocarbon imports.

It may seem that Pakistan’s energy crisis has been endless, but actually the country enjoyed a relatively high level of energy security for its first few decades of existence. Demand was relatively low because Pakistan was a very rural country at the time. Most people were not on the grid and instead depended on biomass and other traditional, noncommercial energy sources. Most baseload energy was sourced from hydroelectric dams, particularly Tarbela Dam—the largest earth-filled dam in the world—which was launched in the 1970s.

However, rapid population growth and urbanization sent demand soaring in the 1980s and especially the 1990s. This was all compounded by the fact that energy was used wastefully. Tarbela and other energy infrastructure started to show their age, and repairs were not made successfully. Poor maintenance led to leaks and other losses. Pakistan averted a disaster in the 1990s by aggressively courting private energy investors, which resulted in about 4,500 megawatts (MW) of generation being added to the grid.

These investments, however, were built on flawed pricing models, and this is where the origins of the current crisis can be traced. Pakistan, in its zeal to attract investors, guaranteed financiers a fixed return on investments regardless of project performance. The result was shoddily constructed facilities that used expensive and inefficient technology. Energy costs eventually rose, and, as a result, the stopgap measure of rapidly developing private power projects failed. Yet demand continued to rise as Pakistan’s economy and population grew, as urbanization intensified, and as existing supplies continued to be managed poorly. This series of events has brought us to where we are today.

As part of a strategy to address the energy crisis, the Pakistan Muslim League-Nawaz, Islamabad’s current ruling party, has begun to implement measures such as smart meters that capture the performance of grid station feeders. How can these measures help alleviate the energy crisis in the short term, and are they sufficient for the long term?

The biggest advantage of these measures is that they empower policymakers with constant data in real time. There has long been a constant refrain that Pakistan lacks sufficient data to deal with its energy crisis. In effect, without access to data, it is difficult to institute effective policies, or even know where to start. If you know there are a lot of power outages in a certain part of the country—or even a certain grid or feeder—but you don’t know exactly why or how often these outages are happening, coming up with the right type of corrective policy is difficult.

However, these smart meters and other new technologies essentially put data in the hands of policymakers in a way that could theoretically allow them to make strong progress in reducing those 20% T&D losses. Thanks to this new data, useful discoveries have already been made: Feeder lengths are directly associated with T&D losses (longer feeders have higher losses), and there is no relationship between losses and power cuts (feeders with low losses often experience more power cuts than those with higher losses).

To be sure, the deployment of this new technology is by no means a nationwide phenomenon. There certainly are not smart meters all over Pakistan. For this reason, it would be a stretch to say that this will be a long-term boon for energy security. These devices need to be deployed over a much larger area before we can start having conversations about lasting solutions.

As you note, this crisis has been an ongoing challenge. You authored an NBR commentary in March 2013 in which you identified a number of near-term steps that could be taken to address the challenges confronting industry leaders and policymakers in Pakistan. Have there been any major developments in the interim?

The sad thing is, that commentary was written more than two years ago, and I would argue that unfortunately not much has really changed. You have a political class that simply lacks the will to take the critical yet politically risky steps necessary to deal with the crisis—steps that include phasing out energy subsidies, introducing pricing reforms that require people to pay more for electricity, and implementing institutional reforms that streamline and bring more order to a very chaotic and dysfunctional energy sector.

I’m actually somewhat surprised that so little has changed over the last two-plus years. Elections in May 2013 brought to power Prime Minister Nawaz Sharif, who had campaigned heavily on the need to deal with the energy crisis. His political party has close ties to the business community, particularly within the agricultural and sugar industries (Sharif’s family is in the sugar business), which are powerful constituencies that would seem to be big proponents of fixing the energy problem. And yet there has been relatively little to show for these ties, other than a few one-off achievements such as launching Pakistan’s first solar power plant. This is not for lack of trying, however; the slow progress may be more the consequence of a government that has had to deal with multiple immediate challenges ranging from terrorism to threats to its political survival.

As Pakistan looks at its longer-term strategies, the country is projected to see significant energy demand growth, which may further exacerbate the crisis if not addressed. Where do coal and natural gas fall within Pakistan’s current energy mix, and how do opinions differ as to what sort of energy mix will best help Pakistan address its energy needs?

Pakistan is not scarce in energy right now. It has supplies but lacks the level of resources needed to meet long-term demand projections. This means that the composition of Pakistan’s energy mix will go a long way toward determining the nature of its energy future.

Pakistan’s official policy today is to push for coal. Such a policy demonstrates a big break from recent policy, which has emphasized imported oil and gas. Coal constitutes a negligible percentage of Pakistan’s current overall mix. The government’s view is that Pakistan should finally take advantage of its vast quantity of untouched indigenous coal reserves—including nearly 200 billion tons alone in the Thar Desert region of Sindh Province. Prime Minister Sharif spoke of this policy repeatedly on the campaign trail, and his government continues to champion Thar today. The problem is that Pakistan lacks the technological capacity and funding to access these reserves. It also lacks infrastructure, especially rail lines, to transport any extracted coal. One rarely if ever hears politicians acknowledging these challenges.

Natural gas, by contrast, is already a core component of Pakistan’s energy policy and constitutes about half the overall energy mix. Yet although gas may appear to be the preferable option over coal, it faces its own challenges. The problem is that domestic supply is being rapidly depleted, and investor interest has dropped off in recent years thanks to factors such as low gas prices, prohibitively small gas fields, overregulation, and a lack of security, technology, and infrastructure in gas-rich regions. That said, there are opportunities. Pakistan, like so many other countries, could be a big beneficiary of the U.S.-Iran nuclear deal, because this accord could pave the way for Pakistan to complete a natural gas pipeline with Iran. Such a pipeline could bring Pakistan up to a billion cubic feet of additional gas per day.

How do you envision Pakistan’s energy mix evolving?

I think that in the short term, unfortunately, Pakistan’s energy mix will continue in its current form—imported and expensive hydrocarbon resources, namely oil and natural gas. At this point, no alternatives are in position to be developed and brought online in a big way over the next few years. Indigenous coal has too many obstacles, hydroelectricity is limited by Pakistan’s rapidly diminishing water supplies and by influential citizens’ movements against large dams, and renewables like solar and wind lack the scale to serve baseload demand. This isn’t to say that Pakistan shouldn’t do what it can in the immediate term to embrace solar and wind—in fact, there is a moment of opportunity because the costs of both resources have fallen in recent months. Some experts believe that with the right developers and investment plans, Pakistan could conceivably bring a new solar or wind plant online in less than twelve months. I fear, though, that this may be overly ambitious.

If you look a bit further down the road, perhaps five or ten years from now, you should start to see a bit more diversity in the energy mix. I think that the Sharif government is really serious about investing in renewables, particularly solar and wind. Islamabad has launched a new solar plant and reduced some taxes on solar panel imports. Pakistan has a lot of sun and wind, so it’s the right kind of place to be tapping into these resources. Bringing these resources online in a big way should not be too hard, especially because the only infrastructural upgrades requiring additional investment by the government relate to T&D. So there is good reason to be hopeful here.

Another important consideration for how best to resolve Pakistan’s energy crisis is the extent to which the country should privatize its energy sector. What are the benefits of partially or fully privatizing?

Privatization is essential simply because the public sector is so dysfunctional. When it comes to energy, the public sector lacks money, it lacks capacity, and it lacks technological know-how. This is a big deal in a country where the government plays such a large role in the energy sector. I think that if there is consensus about anything in Pakistan, particularly within the political class, it’s that the energy sector needs to experience some levels of privatization. There have been efforts toward this goal already. The main electricity supply company in Karachi was privatized a number of years ago, and we’ve seen this lead to greater levels of energy efficiency and reductions in T&D losses, indicating improvement. Furthermore, it goes without saying that when energy institutions are untethered to the state, they will have greater incentive to strengthen their technical capacities and foster accountability.

The problem is that countries need to be very careful about privatizing. They need to do it slowly. You mentioned “partial” privatization as one option, and that option may be the right way to go. There are a lot of vested interests in Pakistan that would be very uncomfortable with the idea of corporate folks coming in and taking over ownership of both operations and assets. In fact, the political class and even the courts have at different times suggested that governments need to take it slow when it comes to implementing this type of change. Particularly risky would be privatizing Pakistan’s distribution companies, which are large, unwieldy, and employ a lot of people. These would be very difficult to swiftly privatize. If you want to look at short-term privatization opportunities, you should look at the generation companies, which are a bit smaller and easier to manage. The best bet is to privatize the generation companies and reorganize the distribution companies into smaller units that operate under franchising models. In other words, Pakistan’s government should transfer operational ownership of the distribution companies to private hands, while retaining control of the assets. This approach would be much less controversial, much less messy, and ultimately much more effective.

How can Pakistan best encourage foreign investment into its energy sector without compromising the country’s energy security as it has done in the past?

In terms of encouraging overall foreign investment, at the end of the day you’re not going to get private investment in Pakistan’s energy sector unless the security situation calms down. The good news is that terrorist violence has declined dramatically in Pakistan in recent months. This is likely because Pakistani military operations in the North Waziristan tribal area have eliminated many terrorists. The problem is that many terrorists were simply displaced, and once they’ve reorganized in their new sanctuaries, they could launch new campaigns of terrorist violence. For this reason, Pakistan should act now to make new pitches for investors while the security situation is calm.

That said, stability is no silver bullet for sluggish foreign investment. Pakistan needs to do more about its red tape, corruption, and other nonsecurity factors that constrain foreign investment. No new international oil companies have entered Pakistan over the last decade, a reality attributable not just to security fears but also to concerns about overregulation and pricing policies. One more thing Pakistan needs to do is cast a wider net in terms of the types of energy investors it courts. Its aggressive pursuit of Chinese investors has made investors from other countries fear that the playing field is not level. And the last thing Pakistan wants to do is alienate otherwise-interested potential investors.

In April 2015, China gifted an unprecedented investment of $46 billion to Pakistan, $35 billion of which is meant to be allocated to the energy sector. How does this monetary gift compare to current and prior investments from other countries? What does China hope to accomplish with such a large monetary gift?

There’s no overstating how much money is involved here. For a comparison, the United States is one of the most generous donors to Pakistan, and yet that $46 billion far exceeds what the United States has provided to Pakistan in development assistance over a number of years. So it’s a lot of money; there’s no doubt about that.

China’s motivation for providing this gift is not necessarily to improve Pakistan’s energy security. Or at least that’s not the chief motivation. China does not provide infrastructure support, no matter how large or small, out of sheer benevolence. Rather, China has a strong interest in promoting energy infrastructure projects in Pakistan because it believes Islamabad can help serve Beijing’s broader strategic goal of developing a new economic trade corridor to China’s west—one that will link China to the Middle East and Europe. Essentially, China is looking to create alternative trade routes to facilitate the transit of its imports from the Middle East and Europe to sites within China. And Pakistan, because of its geographic position, plays a very important role in this grand scheme. Hence, China’s stated intentions to build roads, power plants, and ports in Pakistan. China is doing this not for Pakistan but for itself. There is nothing charitable about this $46 billion gift.

I would also contend that despite the rhetoric among many in Pakistan that this investment will solve the country’s energy crisis, it will not magically resolve the problems from which the crisis stems. These infrastructure projects, if they are developed, will provide a whole lot of energy—up to 17,000 MW of new generation capacity, according to estimates. That’s nearly as much as Pakistan’s total current installed electricity capacity. However, there’s no guarantee that these projects will all come to fruition. China has a history of promising more than it actually delivers. Consider, for example, that in January 2015 China quietly withdrew its support for the development of several coal plants in Baluchistan.

Furthermore, China’s investments are all about supply. They are meant to build new capacity. This is well and good, but the projects will do nothing to address the governance-related problems that fuel Pakistan’s energy crisis. These investments have little to do with repairing dilapidated equipment, undertaking pricing reform, or bringing more order to the energy sector. These investments will not be used to produce the non-sexy yet essential outcomes needed to deal with the crisis.

Quite frankly, China could do a lot more to ease Pakistan’s energy crisis if instead of building new infrastructure and simply creating more supply, it did things that were more modest but no less important, like trying to reduce transmission losses by repairing equipment and machinery that don’t work. Such investment would be a big boost right there. But these activities would not fit into China’s strategic plans and therefore are not likely to materialize.

What are the most important changes that we must see in the political will and governance of Pakistan’s energy sector to prevent the energy crisis from worsening?

I think the single most important thing that Pakistan needs to do, yet has refused to do, is to bring more order to the energy sector. There are over a dozen different entities that have some sort of say in energy policy. You have all these fiefdoms within the energy policy world that want to have some sort of influence or power over how energy policy is formulated, developed, and implemented. This simply doesn’t work, because all of these entities are highly dysfunctional. They don’t get along, and they don’t coordinate. It’s a classic case of too many cooks in the kitchen.

If you want to talk about moving forward with new policies, then that’s great. But unless Pakistan has an effective institutional structure in place to allow policy to be properly developed, then nothing’s going to change. Once a more effective institutional framework is in place, then the rest can follow. At that point you can introduce the pricing policy reforms and other essential measures.

This institutional reform is something that only Pakistan can undertake. It is not something that China, the United States, or any other foreign donor can do anything about. And this raises a broader issue: at the end of the day, Pakistan, and Pakistan alone, needs to take ownership over its energy crisis. This issue of ownership, of taking responsibility without simply blaming previous governments or other external factors, is something with relevance for many of the country’s policy challenges, whether related to economics, politics, or security. Pakistan needs to acknowledge energy as a big problem, and then it needs to take hard and politically risky steps. And the first place to start is with institutional reforms. This is what I said in the NBR commentary more than two years ago, and it’s what I believe now as well.

Michael Kugelman is the Senior Associate for South Asia at the Woodrow Wilson International Center for Scholars in Washington, D.C.

This interview was conducted by Wendy Culp, an Intern in the Trade, Economic, and Energy Affairs group at NBR.

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Welcome to Pakistan

How to solve Pakistan’s energy crisis

hammad azhar is the current energy minister of pakistan photo file

The world is confronted with a challenge to cut emissions at a swift rate to ensure net zero targets are met. In the meantime, countries around the world are scrambling to attain a clean energy profile while also guaranteeing security of supply and avoiding any unwanted socio-economic fallouts. The challenge is a wholly distinct one depending on the country under examination.

In the case of Britain and much of the developed world, industrialization commenced over two centuries ago. Shortly after James Watt patented the steam engine in 1769, coal was used to make iron and power ships, locomotives, and other machines. Coal became the backbone of the British Empire that extracted wealth from around the world and left behind economies that were less than a shadow of the then industrialized world. Those same economies, most of whom still find themselves in the category of developing nations, are now faced with a monumental task. They must grow their economies, pull populations out of poverty and upscale their inchoate industries while being held accountable for prolonged dependence on fossil fuels and its effects on the planet. This is the predicament that we find ourselves in today. In devising a long term strategy, Pakistan will have to reconcile three main aspects of its energy profile: It must have a generation mix that is highly indigenised; has low carbon emission, and; is able to support an ecosystem that allows for practical grid load management.

At present, Pakistan imports a third of its energy resources and ranks among the lowest (99 out of 110) in energy security according to the World Energy Council. The recently published Indicative Generation Capacity Expansion Plan (IGCEP) 2021-2030 has outlined plans to expand hydro as well as solar and wind generation so that it accounts for 60% of Pakistan’s energy generation by 2030. The rest of the demand is expected to be fulfilled by local and imported coal and RLNG among other sources. However, even if these targets are met, imported coal and RLNG will still account for around 24% of installed capacity in 2030. Continued dependence on imported fuels is set to remain a burden on the country’s foreign exchange reserves and expose the economy to sudden changes in fuel prices spurred by political developments elsewhere. In a world that is weaning off coal, it is also an added blot on Pakistan’s carbon footprint. Emissions intensity in the power sector currently stands at 353 g-CO 2 /kWh and will decrease to 200 g-CO 2 /kWh according to IGCEP calculations. Although this may seem encouraging, countries like the United Kingdom have set targets three times lower than IGCEP’s best case scenarios. Furthermore, it is worth remembering that Pakistan lags behind the rest of the world in electrification, particularly in the electric vehicles space, and will eventually need to close this emissions gap if it wants to approach net zero. Given the ongoing capacity payments crisis on existing thermal power plants and the dwindling costs of renewable energy and battery storage, the need of the hour is certainly not an expansion of coal-fired generation.

The government’s primary focus at this juncture is on providing cheap electricity to the population and overcoming problems like load shedding and capacity payments on existing thermal plants. However, the country still requires a strategy to rid itself of dependence on fossil fuels in the years after 2030 and adopt a well-grounded plan for grid stability and load management. Large scale problems like this rarely have silver bullet solutions but a hitherto unexplored area of interest that may offer profound support is geothermal power: Renewable heat energy extracted from deep underneath the Earth’s surface. Geothermal plants have negligible emissions when compared to coal-fired power plants and also have longer lifespans and lower operating costs.

Several countries have managed to veritably grow their economies in the post-war years. However, few have managed to do it in a thoroughly sustainable manner. A country that rarely comes to mind in such discussions is Iceland, once amongst the poorest countries in Europe. Rather than being pushed into an import-driven energy policy, Iceland pioneered geothermal power generation in a bid to become self-sufficient. As it turned out, lying on a fault line meant that the country was blessed with abundant geothermal energy reserves. Eventually, geothermal generation reached levels so high, and energy became so cheap, that the Icelandic people were able to bathe in outdoor heated swimming pools all year round, grow crops and farm fish never before seen on the island and develop thriving energy intensive industries such as Aluminium production which now accounts for 40% of its export. Since then, developing countries like Indonesia, Philippines, Turkey, and Kenya have been inspired by Iceland’s model and built capacities between 0.9-2 GW.

For decades, we Pakistanis have lamented the fault lines beneath our feet and have had to bear the tectonic tragedies that emanate from it. Why not seek to reverse the curse of these geological fractures and exploit the clean energy that their indelible presence may offer? There are few estimates of exactly how much geothermal power can be generated in Pakistan. The few estimates that have been floated are in the staggering range of 10 GW or more – maximum total electricity demand in Pakistan in 2020 was 25 GW. Studies have cited particularly large reserves in Gilgit Baltistan and Balochistan. The use of geothermal energy for heating and cooking applications would also mean less pressure on the economy to rapidly electrify these sectors of consumption. Pakistan is one of the 46 member states of the Global Geothermal Alliance, and yet the lack of government interest in this field is striking. Geothermal energy does not feature in any recent policy document of the IGCEP, Alternative Energy Development Board (AEDB), National Transmission & Dispatch Center (NTDC) or Ministry of Energy. Perhaps the high capital costs of setting up a geothermal power plant is seen as a glaring deterrent. However, once operational, geothermal power plants are cheap to maintain and offer inexpensive electricity, as they do not require fuel and are always running. Hence, unlike most renewable sources, it is not intermittent and has high capacity factors.

Home grown geothermal power has the potential to give the country a much needed boost in fulfilling rising energy demands while limiting emissions and adhering to international commitments. In addition, the economy will call upon a more indigenised energy supply, thereby reaping the strategic benefits of no longer being hostage to capricious contingencies associated with imported fuels. In due course, these measures will also make electricity more affordable for the masses.

The writer is a student at the University of Edinburgh majoring in Mechanical Engineering and Renewable Energy. He is also the President of the Edinburgh University Energy and Sustainability Society. He can be contacted at [email protected] or @AndrabiRaafey on Twitter.

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Pakistan’s energy quagmire: Subsidies, debt, and the quest for sustainability

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In the heart of South Asia, Pakistan grapples with a crippling energy crisis, its grip tightening with each passing year. Over 28% of Pakistani households in 2019 were already burdened by high energy costs, a consequence of the country's heavy reliance on imported, non-renewable fuels. This figure is projected to exceed 30% as inflation continues to spiral upwards in the energy sector.

At the heart of the issue lies a misguided approach to energy policy. Instead of prioritizing a transition to cleaner energy sources, the Pakistani government funnels billions into servicing debts accrued by the ailing power sector.

Ballooning circular debt

This annual expenditure on power subsidies has reached an alarming PKR 0.58 trillion in the fiscal year 2024, highlighting a shortsighted strategy that fails to address the root cause of the problem.

This misplaced focus has done little to alleviate the PKR 2.5 trillion debt already accumulated by September 2023, even with tariff hikes implemented across the board. As energy demands steadily rise, Pakistan finds itself caught in a self-perpetuating energy quagmire.

Desperate for quick fixes, the government plans to terminate subsidies for agricultural tube wells in June 2024. However, this knee-jerk reaction carries its own set of risks.

The increasing cost of power in Pakistan is a cause for concern, particularly as the nation grapples with the financial fallout of the COVID-19 pandemic. Rising inflation in energy costs is likely to push the percentage of households struggling with expensive energy beyond the current 28%. The government's current focus on servicing debts rather than transitioning to cleaner and more sustainable energy sources could lead to a vicious cycle of escalating costs and increasing financial burdens on both the government and the general population.

Reliance on coal

Moreover, Pakistan's reliance on coal as a primary energy source poses a significant challenge to the country's sustainability goals. As the government grapples with the immediate financial crisis, the shift towards coal threatens to compromise long-term environmental and health considerations. This raises concerns about the nation's commitment to international climate goals and the well-being of its citizens.

A closer look at the subsidy trail reveals a troubling picture. Over the past decade, the government has poured billions into the power sector, with the annual outlay skyrocketing from PKR 245,100 million in 2013-14 to a staggering PKR 579,075 million in 2023-24. This surge in subsidies coincides with a concerning trajectory for the power sector's circular debt, which ballooned to PKR 2.5 trillion by September 2023 despite tariff hikes.

Skewed priorities

The breakdown of subsidies further exposes the skewed priorities. While the public utility giant WAPDA/PEPCO receives the lion's share of handouts, Karachi Electric Supply Company (KESC) also gets a significant chunk of the pie. This raises questions about the efficiency and transparency of these entities and whether the subsidies are actually reaching those who need them most.

Pakistan's predicament can be likened to a man trapped in quicksand. Every desperate attempt to escape, such as terminating agricultural subsidies or increasing reliance on coal, only sinks him deeper. The solution lies not in short-term fixes but in a bold and comprehensive shift towards sustainable energy sources.

Beacon of Hope

Renewable energy, like solar and wind power, offers a beacon of hope in this bleak landscape. Not only are these sources cleaner and more environmentally friendly, but they also hold the potential to break the cycle of dependence on imported fuels and reduce the burden of debt.

Pakistan possesses abundant potential for renewable energy generation. Studies estimate that the country has the capacity to generate over 50,000 MW of solar power alone. Yet, only a fraction of this potential is currently being tapped.

Investing in renewable energy infrastructure and creating a conducive policy environment are essential steps toward breaking free from the self-perpetuating energy crisis. This not only requires government commitment but also active participation from the private sector and civil society.

The transition to clean energy will not be without its challenges. Initial costs may be higher, and existing infrastructure may need to be revamped. However, the long-term benefits far outweigh the short-term hurdles. Sustainable energy will not only ease the financial burden on households and businesses but also contribute to cleaner air, improved public health, and a more secure energy future for Pakistan.

The time for half-hearted measures and quick fixes is over. Pakistan's energy crisis demands a paradigm shift—a move away from fossil fuels and towards embracing the power of renewable energy. Only then can the country break free from the quicksand of debt and chart a course towards a brighter, more sustainable future.

Pakistan stands at a critical juncture in its energy landscape, grappling with the interplay of subsidies, debts, and the urgent need for sustainable solutions. The government's current approach, marked by substantial annual expenditures on power subsidies and a focus on debt servicing, may provide short-term relief but fails to address the root causes of the energy crisis. The termination of subsidies for agricultural tube wells, while a potential cost-cutting measure, could exacerbate the larger issue of escalating power costs and coal dependency.

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E-Paper | September 01, 2024

Average daily gas

700mmcfd shortfall

Off-flexold rural villges

436.2 millionbb 2007 est

30,090 bbl/day 2007 est

NATURAL GAS
ALTERNATIVE ENERGY

The year started with the shut down of Uch power plant producing 585MW of electricity, as one of the pipelines providing fuel was blown up in the district of Jaffarabad. Pakistan faced one of its most crucial gas crises, with the shortfall rising up to 1.8 billion cubic feet (bcf). The year also experienced the worst CNG load shedding resulting in losses and problems for the consumers. However OGRA increased the gas tariff by 14 per cent in the beginning of the year which was one of the biggest tariff hikes in the history of Pakistan. Moreover, the energy shortfall reached up to 2,700 MW.

Sheikhan gas field, which is located in Kohat, Kyber Pakhtunkhwa, was discovered. Moreover, the torrential rainfall in the year resulted in floods which caused much damage to the existing infrastructure transmitting/transferring energy and fuel. Towards the end of the year, country’s first rental power plant (RPP), with the capacity of 232 MW was inaugurated in Karachi.

NASHPA oil fields were discovered in Karak district of Kyber Pakhtunkhwa. In the same year, Karachi faced one of its most crucial power breakdowns on June 17 in which the entire city was without power for 21 hours and more.Moreover, the country faced a power shortfall of 4,500 MW in the same year with the domestic demand rising up to 11,000 MW. However only 6,500 MW of generated power was catering to the entire demand.

The demand and supply gap pertaining to electricity in Pakistan increased by 15 per cent.The major load shedding crisis also commenced in the same year with power outages extending up to 16 hours a day in many cities of the country.

Pakistan faced one of its biggest power failures after Bhutto’s assassination in which production fell by 6,000 MW.

Mela oil fields were discovered in the area of Kohat located in the province of Khyber Pakhtunkhwa.

International Sovereign Energy, a Canadian company, signed an MoU with Oil and Gas Development Company Limited. The memorandum entailed further development of Toot Oil Fields. Pakistan was hit by one of its most devastating earthquakes which resulted in a vast damage to the infrastructural capital responsible for transmitting/transferring fuel. In the December of 2005, Karachi electric Supply Company, one of the largest vertically integrated power supply company in Pakistan was privatised.

Chanda oil fields located in Khyber Pakhtunkhwa started oil production.

Balochistan Liberation Army allegedly bombed one of the minor pipelines transmitting gas from Sui gas fields.

The oil fields owned by Union Texas Pakistan were producing more oil than the Potwar wells.

Rajjan oil field, located in Gujjar Khan, was discovered.

Qadirpur gas field was discovered in the province of Sindh. It remains the third largest gas field in Pakistan.

Dakni gas field started commercial production in December 1989.

The year witnessed the peak in oil production from Toot Oilfields which was 2,400 barrels per day. Moreover, Chak Naurang field located 90 kms away from Islamabad was discovered in the June of 1986.

Tando Adam oil field, located in Hyderabad, was drilled and completed.

Dakni gas field, located about 135 Kms in the south-west of Islamabad, was discovered in 1983.

Union Texas Pakistan discovered an oil field in lower Sindh.

Dhodak gas field was discovered in the province of Punjab.

The commercial production from Toot Oilfields started in 1967.

The Toot Oilfields, located in the Potwar region of Punjab were found. During Ayub Khan’s regime Pakistan Petroleum and Pakistan Oilfields explored and drilled the first well. Toot Oilfields have an approximate capacity to produce 60 million barrels of oil.

Commercial drilling and exploring of Sui gas fields was started. Sui gas field contributes substantially to fulfil Pakistan’s fuel requirements and have a daily production of approximately 550 MMscf.Pakistan Petroleum Limited (PPL) discovered gas reserves at Uch gas field.

The first oil field in Pakistan was discovered in the province of Balochistan near a Sui gas field. During the same time period, Sui gas field, which remains the biggest natural gas field in Pakistan, was discovered.

Table of Contents

Pakistan has been facing an energy crisis for several years. The main causes of the crisis include a lack of investment in new power generation capacity, outdated and inefficient power plants, and inadequate transmission and distribution infrastructure. Additionally, the country has long struggled with issues of energy theft and non-payment of bills by consumers.

The crisis has led to frequent power outages, which have negatively impacted economic growth and the daily lives of citizens. The government has taken steps to address the crisis, such as investing in new power generation projects and implementing policies to reduce energy theft, but more work needs to be done to fully resolve the issue.

Causes of Energy Crisis in Pakistan

The energy crisis in Pakistan is caused by a combination of factors, including:

Insufficient power generation capacity: Pakistan has not invested enough in new power generation projects, leading to a shortage of electricity.
Inefficient power plants: A large portion of Pakistan’s power generation capacity is from old and inefficient power plants, which consume more fuel and produce less electricity.
Transmission and distribution losses: The transmission and distribution infrastructure in Pakistan is inadequate and outdated, leading to significant losses of electricity during transmission and distribution.
Power theft and non-payment of bills: Power theft is a major problem in Pakistan, as is the non-payment of bills by consumers. This leads to a financial crisis for power companies, which then struggle to generate enough revenue to maintain and expand their operations.
Fuel shortages: Pakistan has been facing fuel shortages for power generation, which leads to power outages and load shedding.
Dependence on oil-based power generation: Pakistan is highly dependent on oil-based power generation, which makes it vulnerable to fluctuations in global oil prices.
Water scarcity: Pakistan has been facing water scarcity which leads to the non-availability of water to run hydro-power stations at full capacity.
Political instability: Political instability and lack of continuity in policies have led to the neglect of power projects and lack of investment.

Overall, resolving the energy crisis in Pakistan will require a combination of short-term solutions, such as increasing power generation capacity and reducing transmission and distribution losses, as well as longer-term solutions, such as investing in renewable energy sources and improving the overall efficiency of the power sector.

Consequences of Energy Crisis in Pakistan

The energy crisis in Pakistan has had a number of negative consequences for the country and its citizens:

Economic damage: The energy crisis has had a significant negative impact on Pakistan’s economy. Businesses have been forced to close or scale back operations due to power outages, and the lack of reliable electricity has made it difficult for industries to operate at full capacity.
Reduced quality of life: Power outages have caused inconvenience and hardship for citizens, particularly during the hot summer months. Inadequate access to electricity has also made it difficult for people to access basic services such as education and healthcare.
Increased poverty: The energy crisis has contributed to increased poverty in Pakistan, as many people have lost their jobs or seen their incomes reduced due to power outages and the resulting economic damage.
Environmental damage: The energy crisis has led to increased use of fossil fuels and wood-burning for power generation, which has contributed to air and water pollution and deforestation.
Reduced foreign investment: The energy crisis has led to reduced foreign investment in Pakistan, as investors are deterred by the lack of reliable electricity and other infrastructure.
Loss of competitiveness: Pakistan’s energy crisis has led to increased production costs, which has resulted in reduced competitiveness in international markets.
Political instability: The energy crisis has led to social unrest and protests against the government.
Dependence on imports: Pakistan’s energy crisis has led to increased dependence on imported energy, which has strained the country’s balance of payments and further weakened its economy.

Overall, the energy crisis in Pakistan has had a wide-reaching and negative impact on the country’s economy and society, and resolving the crisis will be crucial for achieving long-term economic growth and development.

Solutions of the Energy Crisis in Pakistan

There are a number of potential solutions to the energy crisis in Pakistan, including:

Increasing power generation capacity: Pakistan needs to invest in new power generation projects, such as building new power plants and expanding existing ones, in order to increase the country’s overall power generation capacity.
Developing renewable energy sources: Pakistan should invest in renewable energy sources such as solar and wind power to reduce its dependence on fossil fuels and to lower its greenhouse gas emissions.
Improving the efficiency of power plants: Pakistan should invest in upgrading its existing power plants to increase their efficiency and reduce the amount of fuel they consume.
Upgrading transmission and distribution infrastructure: Pakistan should improve its transmission and distribution infrastructure to reduce losses of electricity during transmission and distribution, which will improve the overall efficiency of the power sector.
Reducing power theft and non-payment of bills: The government should implement policies and measures to reduce power theft and improve bill collection to make the power sector financially stable.
Increasing water storage: Pakistan should invest in increasing water storage capacity, so that water can be stored during the monsoon season and used to generate power during the dry season.
Improving energy conservation: Pakistan should invest in energy conservation measures, such as promoting energy-efficient appliances and buildings, to reduce the overall demand for electricity.
Diversifying energy mix: To reduce dependence on oil-based power generation and to decrease the impact of fluctuation of oil prices, the government should invest in diversifying the energy mix to include coal, hydro, nuclear, and renewable energy.
Improving governance: The government should work on improving governance by promoting transparency and accountability in the power sector and ensuring continuity in policies.

Implementing these solutions will require significant investment, political will and strong governance. Additionally, it will take time to see the results and to fully resolve the energy crisis in Pakistan.

A sustainable solution for electricity crisis in Pakistan: opportunities, barriers, and policy implications for 100% renewable energy

Research Article
Published: 12 August 2019
Volume 26 , pages 29687–29703, ( 2019 )

Cite this article

Syed Ahsan Ali Shah 1 &
Yasir Ahmed Solangi 1

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This study aims to explore the potential of renewable energy resources to attain a 100% renewable electricity system in Pakistan. Currently, most of the electricity supply comes from fossil fuel, which is imported because Pakistan lacks its own resources. The imports of fossil fuel cost a huge amount and therefore afflict the already fragile economy. Further, the policy to rely on fossil fuel has significantly failed to address the energy crisis that has been lingering for the past two decades, and an acute shortage of electricity hinders the progress of various sectors of the economy. In addition, the global climate index has listed Pakistan among the top 10 climate-vulnerable countries, which makes it pertinent for the country to take precautionary measures for climate change mitigation. Pakistan has abundant renewable energy resources, which are more than sufficient to meet 100% of the present and future electricity demands. On the basis of the existing literature and the dilemma of the energy crisis and climate vulnerability, this study argues that transition to a 100% renewable electricity system is not only an option but also an urgent requirement. Further, we list the potential barriers, in the context of Pakistan, and put forward the policy implications for a swift transition to an entirely renewable electricity system.

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• Pakistan’s energy supply overly depends on imported fuels.

• Energy imports threaten future energy security.

• Continued fossil fuel consumption deteriorates the climate.

• Indigenous renewable energy sources can deliver 100% electricity demand.

• Political will is important for renewable energy transition.

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Shah, S.A.A., Solangi, Y.A. A sustainable solution for electricity crisis in Pakistan: opportunities, barriers, and policy implications for 100% renewable energy. Environ Sci Pollut Res 26 , 29687–29703 (2019). https://doi.org/10.1007/s11356-019-06102-0

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DOI : https://doi.org/10.1007/s11356-019-06102-0

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Energy Crisis in Pakistan: Causes, Ramifications, and Suggestions

Areeba Fatima
December 15, 2023
CSS Essays , CSS Solved Essays

CSS and PMS Solved Essays | Energy Crisis in Pakistan: Causes, Ramifications, and Suggestions

Areeba Fatima , a Sir Syed Kazim Ali student, has attempted the CSS essay “ Energy Crisis in Pakistan: Causes, Ramifications, and Suggestions ” on the given pattern, which Sir Syed Kazim Ali teaches his students. Sir Syed Kazim Ali has been Pakistan’s top English writing and CSS, PMS essay and precis coach with the highest success rate of his students. The essay is uploaded to help other competitive aspirants learn and practice essay writing techniques and patterns to qualify for the essay paper.

1-Introduction

2- Energy profile of Pakistan

✓According to the National Electric Power Regulatory Authority’s (NEPRA) 2021 yearly report, Pakistan’s total installed power generation capacity is 39772 MW.

3-Overview of current situation of energy crisis in Pakistan

✓7-8 hours of load shedding
✓Shortage of about 8,500 megawatts (MW)

4-Repercussions of energy crisis on Pakistan

✓ Lowering economic growth
Case in point: According to some estimates, energy shortages have cost the country up to 4% of GDP over the past few years.
✓ Rising spike of unemployment
Case in point: According to the International Monetary Fund, the unemployment ratio of Pakistan has increased to 6.5 per cent in the fiscal year 2023.
✓ Increasing load shedding
Case in point: Electricity shortfalls reached a peak of 8,500 megawatts (MW)—more than 40% of national demand.
✓ Reducing foreign investment
Case in point: According to the State Bank of Pakistan, Foreign Direct Investment (FDI) in 2023 experienced a 25 % decline compared to the previous year
✓ Increasing dependence on imports
Case in point : According to the Pakistan’s ministry of energy and the Oil and Gas Regulatory Authority, energy-deficit Pakistan imports approximately 430,000 metric ton (mt) of motor gasoline, 200,000 mt diesel and 650,000 mt crude oil at a cost of $1.3 billion/month

5- Root causes behind the energy crisis in Pakistan

✓ Prevailing governance crisis
Case in point: According to the World Bank, governance crisis is the third most significant factor responsible for Pakistan’s energy crisis.
✓ Burgeoning circular debt
Case in point: According to the National Bureau of Asian Research (NBR), the circular debt of Pakistan has approached a whopping $4.5 billion.
✓ Increasing transmission loses
Case in point: According to the current estimates, there is about 45 per cent transmission and distribution loss of electricity in Pakistan.
✓ Escalating power theft
Case in point: According to the government estimates, electricity theft cost the country 500 billion Pakistani rupees over the past 15 months.
✓ Soaring fuel shortages
Case in point: According to the Oil Companies Advisory Council (OCAC), delays in the opening of LCs will lead to a fuel shortage in Pakistan and it can face severe liquidity issues in future.

6- Countering measures to control the energy crisis of Pakistan

✓To introduce governance reforms for the maintenance of energy sector
✓To introduce streamline payment system to monitor circular debt
✓To restructure transmission system to mitigate loss
✓To shift from non-renewable energy resources to renewable one
✓To reduce power theft through structural reforms
✓To increase energy conservation by promoting energy efficient appliances

7-Critical analysis

8-Conclusion

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A country’s energy sector is indubitably a hub that fuels its social growth and economic development. However, the energy crisis- a multifaceted problem- has become an anathema for developing countries around the globe, robbing their socio-economic peace. Sad to relate, Pakistan, a fiscally fragile country, has also faced an energy shortfall over the last twenty years due to the failure of government policies. Sadly, the overarching energy crisis has pushed the country into a swamp of issues, such as unemployment, load shedding, and decelerated economic growth. All these problems are deeply rooted in governance shortfall, burgeoning circular debt, archaic methods of energy transformation, and lack of integrated energy policies. Thus, the government and policymakers need to adopt sensible and pragmatic steps to construct the broader picture of the energy sector. For instance, Pakistan should better diversify its energy mix, restructure transmission systems, and introduce sustainable technology to monitor loss. Furthermore, renewable energy sources, like wind turbines and hydropower, can save the country from falling into the pits of energy doom. This essay briefly discusses the overarching impacts of the energy crisis and its leading causes and sheds light on remedial measures to meet the challenge.

Understanding the importance of energy for a country, it is considered the jugular vein of economic development of a country as it is widely utilized for production and development in both industrial and agricultural sectors. According to the National Electric Power Regulatory Authority’s (NEPRA) 2021 yearly report, Pakistan’s total installed power generation capacity is 39772 MW, where 63% of energy comes from thermal (fossil fuels), 25% from hydro, and 5.4% from renewable (Wind, Solar and Biomass) and 6.5% from nuclear energy resources. The report shows the importance of energy for the growth and progression of the country. Due to this, the government has always focused on broadening its fiscal capacity to provide subsidies necessary to supply electricity to the citizens at a price that consumers can afford, which is essential for the well-being of society.

At present, thelingering energy crisis has pushed Pakistan into the vortex of socio-economic evils. The country’s generating capacity falls below demand, and its available domestic energy supplies are dwindling, making it unable to meet burgeoning energy demands. Moreover, Russia-Ukraine conflict has dented the energy crisis in Pakistan, wildly inflating the supply of crude oil and gas from Russia. According to the Sustainable Development Policy Institute (SDPI), the war has directly contributed 8-9 per cent to the current inflation rate in Pakistan as the prices of oil commodities shoot up in the global market. Furthermore, 7-8 hours of load shedding in the country, the substantially inflated energy import bill, and the increased cost of production have triggered acute inflationary pressure on the country.

Furthermore, the aftereffects of the energy crisis are harrowing and have impacted the country’s citizens in every walk of life. To elaborate, the dismal state of Pakistan’s energy crisis has curbed economic development, pushing the country into an economic decline. Moreover, the non-availability of coal, oil, and gas has also severely affected agricultural productivity, which has a significant share in its Gross Domestic Product (GDP). A report states, “The energy shortages in the country have cost it up to 4% of GDP over the past few years . ” Due to the energy shock, production costs have increased while production capacity has decreased, causing Pakistan to face the lowest ebb of economic growth.

Moving ahead, the energy crisis has also stipulated the closure of hundreds of factories, including more than fifteen hundred alone in the industrial hub province of Punjab. It has paralyzed production and exacerbated unemployment. To illustrate, unemployment is a structural issue which remains a significant hindrance to inclusive growth in the country . Additionally, it imperils much-needed investments in development and infrastructure. According to the International Monetary Fund, Pakistan’s unemployment ratio has increased to 6.5 per cent in the fiscal year 2023. Thus, it depicts that the energy crisis has become one of the gravest challenges for employment opportunities in the country.

In the same way, unannounced load-shedding has discouraged the industrialists and decreased the country’s production ratio, causing a severe setback to the rate of exports. Electricity shortfalls peaked at 8,500 megawatts (MW)—more than 40% of national demand. Moreover,there are 7-8 hours of load shedding in homes and 1-2 hours of load-shedding in Pakistan’s industries. The cottage industry has also fallen victim to the uneven electricity schedules. In this way, the country has considerably constrained the flight of foreign capital. For this reason, Pakistan is facing an exacerbated export loss, which, in turn, makes it an economically free country.

Further, for a country suffering from the malaise of the energy crisis, Foreign Direct Investment is a blessing in disguise that creates more job opportunities and increases competition in the market. Unfortunately, Pakistan does not fall in the bracket of these countries, as international investors are discouraged by the lack of electricity and other infrastructure. According to the State Bank of Pakistan, Foreign Direct Investment (FDI) in 2023 experienced a 25 per cent decline as compared to the last year. It indicates a significant reduction in international investment, reducing the country’s capital inflow. Thus, a rising spike in the energy crisis has caused Pakistan’s foreign direct investment to decline.

Similarly, increasing fuel import demand has been the bone of contention for the country’s economy due to the burgeoning energy crisis.Pakistan has to import high-priced petroleum products, oil, coal, and gas and pay import taxes, pushing it into an economic doom . According to the Pakistan’s Ministry of Energy and the Oil and Gas Regulatory Authority, energy-deficit Pakistan imports approximately 430,000 metric tons of motor gasoline, 200,000 metric tons of diesel, and 650,000 metric tons of crude oil at a monthly cost of $1.3 billion. Ironically, the energy dilemma has increased Pakistan’s import dependence, pushing it into an economic crisis.

Since every problem has a cause, various factors have been responsible for the energy crisis in Pakistan. In particular, governance shortfalls are a crucial challenge for the power sector. As Pakistan’s energy policies come under the purview of several government ministries and agencies. However, coordination among all stakeholders is lacking, clear lines of authority are absent, and energy policies are partially implemented, making Pakistan vulnerable to energy disparity. According to the World Bank, the governance crisis is the third most significant factor responsible for Pakistan’s energy crisis. The energy sector in Pakistan is at the mercy of bureaucratic interests and ministerial benefits, creating a looming risk of energy recession.

Going down the ladder, circular debtis also a significant contributor to the vicious cycle of energy crisis. Subsidies and tariff disparities have been the primary reasons behind the cascade of circular debt. The subsidies’ payment went unpaid, making energy companies unable to pay fuel suppliers, curtailing the fuel supply and reducing generating capacity. Briefly, the revenue cost mismatch has pushed Pakistan into circular debt. According to the National Bureau of Asian Research (NBR), Pakistan’s circular debt has reached $4.5 billion. The government’s efforts to shield citizens from soaring expenses have inadvertently strained the financial health of Pakistan’s energy sector.

Likewise, the operational bottleneck of transmission loss, theft, and archaic infrastructure has also challenged the energy sector. Transmission lines connect generation plants and substations in the power sector, and there is a significant loss in energy before it reaches consumers owing to outdated infrastructure and poor technology. According to the current estimates, there is about 45 per cent transmission and distribution loss of electricity in Pakistan. These inefficiencies inflate the cost of electricity production, which can’t be met through consumers’ taxes and tariffs. Due to these inept transmission systems and transmission losses, Pakistan faces an energy dilemma.

Similarly, another factor serving as the bottleneck to Pakistan’s energy security is uncontrolled and mushrooming power theft. Moreover, illegal power theft continues to plague the nation, with up to 17 hours of load shedding daily, creating chaos and dissatisfaction nationwide. According to government estimates, electricity theft has cost the country 500 billion Pakistani rupees over the past 15 months. Thus, power theft, such as meter tampering, physical destruction of energy meters, and illegal connection, has badly undermined Pakistan’s energy security.

Lastly, the soaring fuel shortage due to high prices has also rubbed salt in Pakistan’s energy wounds. Moreover, the State Bank of Pakistan (SBP) has stopped financing and facilitating import payments due to the depletion of foreign exchange reserves. According to the Oil Companies Advisory Council (OCAC), delays in opening LCs will lead to a fuel shortage in Pakistan, and the country can face severe liquidity issues in the future. Pakistan meets one-third of its energy demand using imported natural gas, and the delay in its import can cause severe setbacks to the energy sector. Hence, fuel shortages in the country have inflamed the energy crisis,which makes it reel behind energy security.

Although the energy crisis has overshadowed all other concerns, it is not an issue without a solution. Pakistan can overcome the malice of the energy crisis by adopting holistic and integrated measures. In other words, a better-coordinated energy sector can be attained by consolidating the country’s many energy-related institutions into a single ministry. Moreover, governance reforms and privatization can also help mitigate the energy crisis. For instance, Norway- a politically stabilized country- has a sound governance system that ensures its energy security in the region, making it economically stabilized. Pakistan can also meet rising energy demands by avoiding bureaucratic hurdles and providing governance reforms.

Moreover, implementing streamlined payment systems can significantly alleviate the circular debt. The government should also enforce penalties for payment defaults that can release its debt burden and prevent the domino effect of non-payments throughout the supply chain. Russia has an estimated low level of national debt, ranking it among the economic first-world powers. Pakistan should also focus on transparent and efficient regulatory mechanisms to prevent the escalation of the national debt.

Next, there is a dire need to update transmission lines and infrastructure to reduce energy losses during transmission. It can be done by using higher transmission voltages and increasing the wire sizes of transmission lines. However, it requires huge investment to increase the efficiency of transmission lines to reduce operational inefficiencies. However, once the transmission loss is cured, it will help the country mitigate transmission and distribution losses in the long term. For this reason, Pakistan has to get support from developed countries. Pakistan has signed a project with Iran to lay the transmission lines from the Pakistan-Iran border up to Quetta. Iran has shown its willingness to provide USD 900 million for the project.

Similarly, Pakistan should swiftly shift from expensive oil and gas power plants towards cheap and renewable energy resources. Using renewable energy resources- wind turbines, solar energy, and hydropower- can mitigate the energy production cost . China is the global renewable energy leader, harnessing nearly half of the world’s total operating wind and solar capacity . It has diversified the country’s energy mix and reduced its dependence on energy fuels, boosting economic development. Thus, energy costs can be mitigated by replacing energy resources, and Pakistan can escape the energy dilemma.

Besides, immediate action and reforms are imperative to rectify the illegal power theft and safeguard the nation’s resources. To mitigate the crime, Pakistan should introduce a more advanced metering system with improved efficiency and modern infrastructure. Moreover, there is a need to exhibit an unyielding stance against power theft . In the United States of America, punishment for electricity theft can attract a fine of $150,000 and five years of imprisonment. Therefore, Pakistan should also take robust and punitive measures to send a strong message to thieves and curb the menace.

Finally, Pakistan should also take holistic measures for energy conservation to mitigate the energy crisis. Using energy-efficient appliances and buildings, turning off appliances when not in use, and harnessing renewable energy resources can help Pakistan guard against the shocks of the energy crisis. The Netherlands, a European country, has imposed high taxes and tariffs on electricity and natural gas that made citizens reduce energy usage and conserve more energy for a better future. Thus, it is crucial to recognize that saving energy is the most significant catalyst for minimizing the energy crisis.

In a critical overview, energy is considered the foundation stone of the economic development of a country, and the energy crisis deprives the government of a financial future. It has also halted Pakistan’s socio-economic development owing to a lack of integrated national policies, good governance, and modern infrastructure. Consequently, the country faces a cascade of circular debt, increased inflation, and economic disparity. In brief, the energy crisis has made Pakistan march towards economic doom and threat of default.

In conclusion, the energy crisis has become a pressing issue for Pakistan. It has robbed millions of a bright future and placed the country in the economic doldrums. It is the need of the hour to meet the burgeoning energy demands, which can stimulate socio-economic growth and development. Moreover, importing clean coal, cheaper than imported oil and gas, can also help mitigate the overarching energy crisis. Henceforth, Pakistan can ensure its energy security by exploring alternative energy sources and addressing governance issues.

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Essay on “Energy Crisis in Pakistan” for CSS, PMS, Judiciary Examinations

August 30, 2021
Essay for CSS PMS and Judiciary Exam

This is an essay on “Energy Crisis in Pakistan” for CSS, PMS, and Judiciary Examinations. The energy crisis is the largest single drain on Pakistan’s economy. This crisis stems from a fuel mix transformation initiated two decades ago when power generation came to rely more on imported furnace oil than hydropower. The current energy crisis began to manifest itself in earnest by late 2007. So here is a complete Essay on “Energy Crisis in Pakistan” for CSS, PMS.

Introduction

Energy, demand for all fields
Cheap ways of producing Energy

Causes of Energy Crisis

Lack of dams
Inability to explore coal: 6th largest coal reserves in the world
Lack of renewable energy sources
The problem of circular debt
Losses in transmission and distribution
Wastage of energy
Domestic and household consumption
Aging of the equipment
High cost of fuel
Economic loss
Agricultural loss
Closure of industries
Unemployment
Social issues

Energy Policy (2013-2018)

Suggestions

Alternative sources of Energy

Nuclear power

Building of darns
Long term dams
Medium-term dams
Short term dams

Exploit the coal reserves

Regional gas and oil pipelines

IPI project

TAPI project

Updating the system of transmission and distribution

Essay on “Energy Crisis in Pakistan” for CSS, PMS, Judiciary Examinations

Energy is the lifeline of a nation. The economic engine and the wheels of industry, agriculture, and business need the energy to move forward. Pakistan faces a major energy crisis in natural gas, power, and oil. Power outages usually last 10-12 hours a day in the cities and more in the rural areas. This has left the industries of Pakistan (mainly agricultural, secondary and tertiary sectors) stunned and so they are unable to fully operate.

This has a very negative impact on the economy of the country. The demand for energy in Pakistan is huge, and cannot be fulfilled by electricity production based on oil. It can only meet 20% of our requirement through native production and the remaining oil is imported from the Gulf States and other countries. No major oil, the field has been discovered in the last three decades. It is clear that other alternative production methods must be considered to meet the demand. Most likely one that is cheap, considering the initial setup cost, and costs attached.

The second method of production we use is thermal (i-e using coal to produce electricity). Pakistan has been blessed with wealthy mineral resources, but the sad part is that we are too ign0rant to explore them. We are sitting on gold mines and yet we do nothing about it. Balochistan, for instance, is rich in all sorts of minerals and could be exploited heavily. If we could solve the feudal problems of the provinces, and let the national and international companies explore the area, we might solve our fuel problems too. But this is a precious non-renewable resource, so we need better options.

Another major option is hydroelectric power generation. This is the cheapest and most feasible way of producing electricity for our country. Two major energy dams in Pakistan are Tarbela and Mangla. If only the proposed Kalabagh darn would be constructed, 80% of our energy needs would be fulfilled. The best option is to construct this dam and take advantage of the natural hydrography of Pakistan to the maximum possible extent.

Wind power and solar power generation are good alternatives as well. Their initial costs are low when compared to other methods, and are definitely in the best interests of our country.

Following are the Causes of the Energy Crisis in Pakistan.

In Pakistan, no major dam was constructed after the completion of Mangle and Terbela Dams early I980s. Though the demand for electricity was increasing many governments came and completed their terms but neither government built darns which is the cheapest source of the energy. Pakistan needs to make Kalabagh darn and Basha dams but due to politicization and lack of dedicated politicians, Pakistan is confronting with the problem of the energy crisis. Electricity from hydel cost us Rs. 2-4 rupees per unit.

Pakistan is blessed with a large amount of coal. No serious work is done to explore coal for power generation. This complains that the coal quality is inferior. However, ·ready-made solutions are available to burn any type of coal. The government is looking for the private sector to play its role. In our opinion, the government itself should come forward and install the power plants on the site of coal mines only.

The government is not producing electricity from renewable sources of energy such as wind, solar, tidal, biogas, etc. Though Pakistan has maximum summers suiting for solar energy there are huge taxes which are paid while purchasing this technology. Through solar, Pakistan can produce up to 1,00,000 MW of electricity. Besides, wind energy has the potential of producing 50,000 MW of electricity but Pakistan is not producing from this cheapest source.

If serious work is done then the total shortage can be met from the Hydro and wind power sectors. It is also suggested that small loans should be provided to consumers to install small hydro and solar cells for one family usage of electricity.

One of the main reasons for the serious shortfall in the generation of thermal electricity 1s the problem of the “circular debt” which the present government inherited from the previous regime. In 2007, the government did not compensate the power companies for the subsidy that was being provided to consumers. The power companies in turn could not pay the oil and gas companies, reducing their liquidity to import the furnace oil that was needed to generate electricity.

The interim government , before the elections, in fact, forced the commercial banks to lend Rs34bn to the oil companies whose credit limits were already exhausted. This problem of “circular debt” became more serious in the summer of 2008, as petroleum prices jumped from $100 to $147 a barrel. It is really surprising that this problem has become the main cause of increasing load-shedding but has not so far been addressed on a priority basis. In 2015 the circular debt reached Rs.600 billion.

Very heavy line losses in transmission and distribution because of old and poorly maintained transmission systems, estimated at over 20 percent compared to eight to ten percent in other countries. Large-scale theft of electricity is clearly revealed by the growing difference between units generated or purchased and those paid for.

Wastage of energy by the industry consumes 30 percent of total electricity due to less efficient systems and other practices. For example, the Chinese consume 30 percent less electricity in textile mills because they use water partially heated by solar panels in their boilers. Overuse of energy by the transport sector (consuming 28 percent of total energy) due to old and poorly tuned engines.

Domestic and household consumption which uses 45 percent of total electricity also depicts wasteful and unnecessary uses of lights, air-conditioners, and large-scale illuminations on different occasions. The problems outlined above reveal many structural flaws in our energy system. These include over-dependence on imported energy, inadequate political will, limited financial support and very weak implementation capacity.

One very important reason attributed to this energy shortage is the aging of the generating equipment which could not develop the electricity as per the design requirement. This is the responsibility to continuously updating the equipment and keeping a high standard of maintenance. we sincerely think serious thought should be given for general overhaul and maintenance of existing equipment to keep them in good working order.

So far energy conservation is concerned, newspapers pay lip service in seminars. No serious thought is being given to utilize the energy at the optimum level. A new culture needs to develop to conserve energy. Sometimes on government level illiteracy is blamed for the failure of the energy conservation program. this is not true. Maximum energy is consumed by the elite class which controls all the resources of knowledge and communication. But for their own luxury, they themselves ignore the problem. Government should seriously embark on an energy conservation program.

Following are the effects of the energy crisis in Pakistan.

Energy is pivotal for running all other resources and the crisis of energy directly influences all other sectors of the economy. The economic progress is hampered by a decline in agricultural productivity as well as by halting operations of industries. One important factor of lower GDP and inflation of commodity prices in recent years is attributed to shortfalls in energy supply. Pakistan is facing a high cost of production due to several factors like the energy crisis, the hike in electricity tariff, the increase in interest rate, devaluation of Pakistani rupee, increasing cost of inputs, political instability , removal of subsidy & internal dispute.

Above all factors increase the cost of production which decreases the exports. Exports receipts decrease from$ 10.2B to$ 9.6B. The global recession also hit badly the textile industry. Double-digit inflation also caused a decrease in production in the textile sector.

The agricultural productivity of Pakistan is decreasing due to the provision of energy for running tube wells, agricultural machinery, and the production of fertilizers and pesticides. Thus higher energy means higher agricultural productivity.

Nearly all Industrial units are run with energy and breakage in energy supply is having dire consequences on industrial growth. As a result of the decline in energy supply, industrial units are not only being opened but also the existing industrial units are gradually closing.

By the closure of industrial units and less agricultural productivity, new employment opportunities ceased to exist, and already employed manpower is shredded by the employers to increase their profit ratios. Thus energy crisis contributes to unemployment.

Pakistan’s textile industry is going through one of the toughest periods in decades. The global recession which has hit the global textile really hard is not the only cause for concern. Serious internal issues including the energy crisis affected Pakistan·s textile industry very badly. The high cost of production resulting from an instant rise in energy costs has been the primary cause of concern for the industry.

The depreciation of the Pakistani rupee during last year has significantly raised the cost of imported inputs. Furthermore, double-digit inflation and the high cost of financing have seriously affected the growth in the textile industry. Pakistan’s textile exports in turn have gone down during the last three years as exporters cannot effectively market their products since buyers are not visiting Pakistan due to adverse travel conditions and it is getting more and more difficult for the exporters to travel abroad. Pakistan’s textile industry is lacking in research &development.

The production capability is very low due to obsolete machinery and technology. This factor is primarily related to the domestic usage of energy (cooking, heating, and water provision). Load shedding causes unrest and frustration amongst the people and results in agitation against the government.

The government has finally formulated the much-awaited National Energy Policy 2013-18. Under the policy, power sector subsidy will be phased out by 2018, and load-shedding will be ended by 2017. It aims at generating surplus electricity in 2018, privatizing government-owned power plants and a few power distributing companies (Discos), bringing the double-digit cost of power generation to a single digit, and restructuring the water and power ministry.

National Electric Power Regulatory Authority (Nepra), Oil and Gas Regulatory Authority (OGRA), adjustment of outstanding dues owed by public and private organizations through federal adjusters, and formation of regional transmission and power trading system. The policy comprises seven points envisions a profitable, bankable, and investment-friendly power sector which meets the nation·s needs and boosts its economy in a sustainable and affordable manner while adhering to the most efficient generation, transmission, and distribution standards.

To achieve the long-term vision of the power sector and overcome its challenges, the government has set the following goals: Build a power generation capacity that can meet the country’s energy needs in a sustainable manner; create a culture of energy conservation and responsibility; ensure generation of inexpensive and affordable electricity for domestic, commercial and industrial use; minimize pilferage and adulteration in fuel supply; promote world-class efficiency in power generation; create a c.utting edge transmission network; minimize .financial losses across the systen1, and align the ministries involved in the energy sector and improve governance .

There are Various Methods to Solve the Energy Crisis in Pakistan.

Though wind, Pakistan has potentials of wind energy ranging from 10000 MW to 50000 MW, yet power generation through wind is in initial stages in Pakistan and currently 06 MW has been installed in the first phase in Jhampir through a Turkish company and 50 MW will be installed shortly. More wind power plants will be built in Jhampir, Gharo, Keti Bandar, and Bin Qasim Karachi.

Solar power involves using solar cells to convert sunlight into electricity, using sunlight hitting solar thermal panels to convert sunlight to heat water or air. Pakistan has the potential of more than 100,000 MW from solar energy. The building of solar power plants is underway in Kashmir, Punjab, Sindh, and Balochistan. However, private vendors are importing panels / solar water heaters for consumption in the market.

Alternative Energy Development Board (AEDB) is working for 20,000 solar water heaters in Gilgit Baltistan. Mobile companies have been asked by the government to shift the supply of energy to their transmission towers from petroleum to solar energy panels.

Biomass production involves using garbage or other renewable resources such as sugarcane, corn, or other vegetation to generate electricity. When garbage decomposes, methane is produced and captured in pipes and later burned to produce electricity. Vegetation and wood can be burned directly to generate energy, like fossil fuels, or processed· to form alcohols. Brazil has one of the largest renewable energy programs from biomass/biodiesel in the world, followed by the USA. Alternative Energy Development Board (AEDB) of Pakistan has planned to generate 10 MW of electricity from municipal waste in Karachi followed by similar projects in twenty cities of the country.

Tidal power can be extracted from Moon-gravity-powered tides by locating a water turbine in a tidal current. The turbine can turn an electrical generator, or a gas compressor, that can then store energy until needed. Coastal tides are a source of clean, free, renewable, and sustainable energy. Plans are underway in Pakistan to harness tidal energy; however, no implementation has been made so far.

Nuclear power stations use nuclear fission reactions to generate energy by the reaction of uranium inside a nuclear reactor. Pakistan has a small nuclear power program, with 425 MW capacity, but there are plans to increase this capacity substantially. Since Pakistan is outside the Nuclear Nonproliferation Treaty, it is excluded from trade in nuclear plants or materials, which hinders its development of civil nuclear energy. The remaining issues in the development of nuclear energy are an enrichment of uranium from U235 to U238, controlling chain reaction, and dumping of solid waste.

Pakistan has the potential for hydro resources to generate 41000 to 45000 MW, however, only 6555 MW is currently being generated by this important renewable resource. Four large hydropower dams namely Kalabagh 3600 MW, Bhasha 4500 MW, Bunji 5400 MW, and Dasu 3800 MW can be constructed to generate hydroelectricity. Similarly, many small to medium hydro plants can be installed on rivers and canals, etc.

The longer-term solution to the energy crisis will be to restore the hydro-thermal mix to 60:40 or at least 50:50 in the next five years. The Water Accord of 1991 had o~ened the way for constructing many dams to store water and generate electricity. But the continuing controversy over the KalabaghDam became a major obstacle. Surprisingly, even many smaller and non-controversial hydroelectric projects have been delayed without any justification.

The hydel projects in the pipeline include the following: Neelurn Jhelurn (969 MW), Tarbela Fourth Extension (960 MW), SukiKinari (840 MW), Munda Dam (700 MW), Khan Dubar (130 MW), Allai (126 MW), and Jinnah Hydroelectric power project (96 MW).

Pakistan has the world’s sixth-largest reserves of coal, after the recent discoveries in Thar. The total coal reserve in Pakistan is about 175 billion tons. The current coal production is only 3.5 million tons per year, which is mostly used for the brick and cement industry. Coal has typical problems, such as a high sulfur content (it produces sulfur dioxide, the source of acid rain), mineral matter content (leading to ash and pollution problems), carbon dioxide emission (contributing to global warming), and high moisture content.

However, technologies are available to minimize all of these. Conversion technologies are currently under development to convert coal into environmentally-friendly methanol and hydrogen gas to be used as a clean fuel. The US is working on a major initiative called future gen to produce “zero-emission” power plants of the future. Thar coal can be cleaned and the sulfur reduced so that it can be burnt in conventional coal power plants and also convened into gas. Coal gasification is a slightly more expensive process, but the gas from coal is a proven and cleaner technology. The Chinese had prepared a feasibility report in 2005 to produce 3,000 MW at 5.8 cents per unit, but the project could not move forward because they were offered only 5.3 cents.

There are also many possibilities of regional cooperation in building gas and oil pipelines. These include the Iran-Pakistan-India gas pipeline; the Turkmenistan-Afghanistan-Pakistan gas pipeline; an oil, gas, and electricity corridor from Gwadar to Western China, the import of 1,000 MW electricity from Ragun hydro station in Tajikistan for which an agreement was signed in March 1992 at the rate of 3.3 cents per unit.

The worldwide electricity production, as per the World Bank, is as follows; coal: 40 percent; gas 19 percent; nuclear 16 percent; hydro 16 percent; oil seven percent. Pakistan’s power production is gas 48 percent; hydro 33 percent; oil 16 percent; nuclear two percent, and coal 0.2 percent. There has been a global trend to shift away from oil because of its rising price expected to reach $100 a barrel by the end of this year depending on the international geopolitical situation.

Despite the lowest cost of hydroelectric power, there have been environmental, ecological, and geopolitical concerns over the building of large dams. The supply of natural gas in Pakistan has been depleting over the years, and the country is now looking at the option of imponing gas from Qatar and Central Asia. This leaves the possibility of exploring nuclear, coal, and other alternative energy sources.

Nuclear energy and coal form the lowest source of power production in Pakistan. On the other hand, the world average for nuclear energy is 16 percent and for coal 40 percent. Let us first consider these two potential sources of electric power production for Pakistan. The US obtains 20 percent of its electric power from; clear. energy with 104 reactors; France 78 percent with 59 reactors, Japan 24 percent with 54 re~tors, the UK 23 percent with 31 reactors, and so on. Even India has signed a civilian nuclear cooperation agreement with the United States to develop its nuclear capability for power generation and economic development . It has currently six reactors in operation with a capacity of 3750 MW, and another six with a capacity of 3,340 MW are under construction.

The new agreement will further boost the nuclear power generating capacity of India. Today, nuclear power plants have average capacities of 600-1,000 MW. Pakistan only produces two percent of its power through two reactors (Karachi and Chashrna at 137 MW and 300 MW respectively). Pakistan is a nuclear technologically advanced country with capabilities to produce fuel, yet falls behind most other countries, including India, in terms of nuclear power production. The US introduces 51 percent of its power using coal, Poland 96 percent, South Africa 94 percent, India 68 percent, Australia 77 percent, China 79 percent, Israel 77 percent, UK 35 percent, Japan 28 percent, while Pakistan produces only 0.2 percent of its power through coal.

In Pakistan, smaller windmills are now visible, such as the ones at Gharo, where SZABIST set up an experimental research station many years ago. The Sindh government has recently announced plans to build a 50 MW wind farm in the vicinity of the coastal region at Gharo. Solar power (photovoltaic or thermal) is another alternative energy source option that is generally considered feasible for tropical and equatorial countries. Even though the accepted standard is 1,000 W/m2 of peak power at sea level, an average solar panel (or photovoltaic – PV – panel), delivers an average of only 19- 56W/m2. Solar plants are generally used in cases where smaller amounts of power are required at remote locations. PV is also the most expensive of all options making it less attractive.

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Home → Published Content → Reasons Behind the Energy Crisis in Pakistan

Written by Ghazala Anbreen • August 29, 2024 • 6:46 pm • Opinion , Published Content

Reasons Behind the Energy Crisis in Pakistan

Ghazala Anbreen's work spans energy, journalism, and advocacy; making her a multifaced contributor to important discussions.

Ghazala Anbreen https://www.paradigmshift.com.pk/author/ghazala-anbreen/ The TAPI Gas Pipeline Project and its Geopolitical Complexities

Pakistan’s current energy crisis is not only destroying the economy but also disrupting the state’s political system. The mechanism of power distribution in Pakistan is obsolete and inefficient hence power losses occur to adequately meet the consumer demand. The reasons behind this energy crisis need to be studied in depth if there is to be any hope of effectively tackling it in the future.

“Power outages are not because of less supply of energy in Pakistan, they are because of fluctuations on transmission lines which have not been updated from time to time, and hence the basic issue is of the difference of generation capacity and capacity to transmit it to the distribution companies” – Simra Sohail, Pakistan’s Power Crisis

In 2020, 20% of energy was lost during transmission in Pakistan. It is also said that Sui Gas reserves deplete fast and will soon be exhausted in Pakistan. At the most, they may survive three years or less and then we will be forced to import it. Many experts are of the view that the decision to use natural gas as CNG in cars in Pakistan proved to have more drawbacks than benefits if seen in the backdrop of long-term impacts on gas supply.

A Financial Crisis Created by Circular Debt

The circular debt of the country’s energy sector has reached a staggering Rs 5.422 trillion while capacity payments to IPPs have jumped to Rs 2 trillion (February 2024).

In many cities of Pakistan, there are frequent energy shortages.

“The power outages in Pakistan are because of the circular debt issue. When the government cannot pay in time to the power distribution companies (DISCOs), because of circular debt, these, in turn, cannot pay the power generators (GENCOs). These power generators (GENCOs). These power generators then struggle to pay their fuel suppliers who have no money to import oil. Thus these cash flow problems lead to delayed payments which affects the whole power sector even though we have sufficient generation capacity.” – CBNC

Domestic Energy in Pakistan

Domestic energy production in Pakistan heavily relies on the import of fossil fuels. Setting up coal-fired power plants on imported coal when coal was available locally was strange indeed. Due to insufficient storehouse sites, annual floods wreak havoc on the stockpile.

What is required?

To overcome the energy problems of Pakistan, consistent growth of the economy and its upscaling is required. A strategy to get rid of the dependence on fossil fuels is needed owing to their contribution to carbon emissions. Although Pakistan does not have as many contributions to global emissions as other developed countries do, the state must still be careful that these effluents do not exceed acceptable levels.

Pakistan As of Now

The need of the hour is the distribution of cheap electricity to the population. Electricity shortfall climbed to 6,623 megawatts during May 2024. There is a rampantly volatile commodity price, double-digit inflation, dwindling foreign exchange reserves ( $14.64 billion as of July 12, 2024 ), and dangerously high national debt. Economic instability and the exorbitant cost of living are worsened by the ongoing challenge in energy production and distribution which are adversely impacting economic development.

Pakistan has supply mismanagement issues. Overarched planning by the regulatory bodies in Pakistan needs to be improved. The focus should be on areas like energy management, infrastructure, and economic planning. The industry must be made competitive.

Pakistan has participated in 24 IMF programs since signing its first agreement in 1958 to help overcome the economic crisis. The IMF’s policies are narrowly based and they want to secure their loans. Pakistan has also sought financial assistance from China, Saudi Arabia, and the UAE.

Causes of the Energy Crisis

The mismanagement in the oil and gas companies’ licensing processes, permit applications, and the subcontracting of parts of a company’s operations lead to chaos whereby inflated energy prices and industry closure become the apparent manifestations. Lack of technical expertise is also responsible. Inefficiency and myopic policy commitment to IPPs are another reason.

Per capita energy consumption is directly related to the economic development of any country. According to NEPRA Pakistan’s per capita annual electricity consumption was 644 kilowatt hours in 2022 which was among the lowest in the world. In fiscal year 2023, Pakistan’s total electricity consumption, as measured in terms of sales, amounted to 112,891 GWh , which is equivalent to approximately 456 kWh per person. According to still another source Pakistan’s annual electricity consumption for 2024 is 83,109 GWh which is equal to 331 kWh per person in Pakistan

Conventional Energy Resources

Conventional energy resources are depleting with time. Moreover, they emit harmful emissions like carbon dioxide, methane, sulfur dioxide, nitrogen oxide, and nitrous oxide. These points are proved by the direct correlation between economic development and carbon emissions. “The global surface concentration of carbon dioxide averaged across all 12 months of 2023 was 419.3 ppm (parts per million) ” and it should be noted that as many as five years are taken to reduce 1 part per million. Due to increased carbon emissions and climate change, extreme weather patterns are visible.

The abovementioned factoid also emphasizes having recourse to cleaner sources of energy. Renewable energy resources are environment-friendly and are viable to meet the future energy demand. In Pakistan, there are abundant natural resources. They are in North West KPK and at the coastline of Sindh where there are vast resources of wind energy.

We should follow a route that complies with nature and pay special attention to the alternative energy measures that ensure our survival in the future. If we go against nature, it will simply recoil against us. At some point, the global population will reach a point where the Earth won’t be able to support it.

Energy Economics

Energy economics should be incorporated into the state’s energy policies. For this, we need experts. Students should be given proper training in colleges and universities to enable their participation in the field.

Most importantly the culture of “being the son of the soil” should be engendered in the youth. They should get rid of the fixation on leaving the country for good. It should be in their minds that they may leave temporarily to enhance their capacity but must come back to utilize their expertise for the uplifting of their country. This commitment is lacking in our youth.

Recommendations

Incentivizing renewable energy and energy efficiency ensures the development of economics and trade. We need to socially contextualize energy crises. Individual contribution—using energy-efficient devices, and LEDs and propagating behavioral changes including using public transport, reducing the use of private cars, walking more, and cycling—can help foster an energy-saving culture.

Other measures include cutting carbon emissions to limit temperature increases and maintain it at 15°C.

The government should be more proactive in its shift to renewable sources of energy. Pakistan needs sustainable economic growth for a reasonable period.

Pakistan’s prime challenge is economic growth. It should aim at an economic growth rate of 6 to 7% which can be achieved through a stable monetary policy, a balanced capital account, and preservation of biodiversity and ecosystem along with other factors. Pakistan’s energy mix currently indicates that we are more inclined towards non-renewable sources.

Energy sources such as solar, wind power, and tidal have a low share. Pakistan must prepare for a sustainable energy transition. There is a need to diversify the energy mix. Energy security is a fundamental requirement for any country. It leads a country to be prosperous.

Way Forward

Excessive dependence on non-renewable energy sources must be avoided. A resilient energy infrastructure is required. We should go for utilizing untapped green energy sources like solar, hydro, wind, tidal, nuclear, biofuels, and geothermal. Upgrading grids and overhauling the transmission process is also important. Sustainable energy policies are required as well. These are necessary steps for any country to take when dealing with an energy crisis.

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The views and opinions expressed in this article/paper are the author’s own and do not necessarily reflect the editorial position of Paradigm Shift .

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Pakistan’s Energy Crisis

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Energy shortages are hobbling the economy and contributing to unrest. But the country has options.

Pakistan is in the midst of one of the worst energy crises in its history. This is both slowing the pace of economic activity and causing public unrest with prolonged outages of electricity and gas. Capacity utilization in some key industries has fallen to nearly 50 percent. Worst affected is the fertilizer industry, which faces interruptions to its gas supply and forced closures. Pakistan has the capacity to produce more than one million tons in exportable surplus urea, yet in 2011-12 it imported more than 1.1 million tons . This eroded the country’s foreign exchange reserves and effectively entailed the payment of millions of dollars in subsidies, being the difference between the cost of locally produced and imported urea. Pakistan urgently needs to make some strategic decisions and change the national energy mix.

Immediately after assuming power, the government of Nawaz Sharif came up with two policy decisions: pay half a trillion rupees (just under $5 billion) to energy companies and announce a new power policy . Both steps are aimed at resolving problems plaguing the companies belonging to the energy chain and bringing change to Pakistan’s energy mix to optimize the average cost of electricity generation.

Pakistan’s government paid Rs260 billion in cash to independent power plants (IPPs) to clear outstanding debt. It also issued bonds to pay off liabilities pertaining to state-owned companies such as exploration and production firms and oil and gas marketing entities. After clearing the debt of the IPPs, it was expected that they would be able to generate 1,700MW in additional electricity, attenuating the shortfall that currently exceeds 6,000MW. The situation is likely to improve over time.

According to the available data, at present installed power generation capacity in Pakistan is estimated to about 22,500MW (excluding the Karachi Energy Supply Company, more on which below), but actual power generation hovers around 15,000MW, partly because of outdated and inefficient power plants and partly because of a cash crunch, which often does not permit power plants to operate at optimum capacity because of the inability to buy the required furnace oil. This could be best understood when one looks at the available data on power plants operating in the public sector, which have an installed capacity of over 4,800MW but actual generation hovering around 1,200MW.

At present, the bulk of electricity supply comes from hydroelectric plants (6,500MW) and IPPs (6,500MW). The output of the hydro plants is dependent on water availability in the dams, and can fall to as low as 2,500MW when water levels drop drastically. And as we have seen, IPP output is limited by money problems.

Pakistan’s woes have been exacerbated by its excessive reliance on thermal power plants, mainly using furnace oil. Two factors contributed to the emergence of this situation: a change in lenders from the public to private sector, and Pakistan’s failure to complete a hydroelectric project in recent decades. The last mega dam, Tarbella, was completed in the mid seventies and no other dam has been constructed since. After the signing of the Indus Water Treaty with India, Pakistan was required to complete construction of one mega-size hydroelectricity plant per decade to ensure year-round availability of low cost electricity and irrigation water.

Of Pakistan’s 6,500MW hydro capacity, the bulk is contributed by three projects: Mangla, Tarbella and Ghazi Brotha. There are nearly two dozen IPPs, but the major players are Hub Power Company, Kot Addu Power Company and Uch Power Plant. Pakistan also has three nuclear power plants, two in Punjab and one in Karachian, with aggregate capacity of over 800MW. However, the Karachi plant is at the end of its effective life and its capacity cannot be termed “dependable.”

Unlike the rest of Pakistan, Karachi gets its electricity from a compact utility, Karachi Electric Supply Company (KESC), which handles generation, transmission and distribution. The bulk of its generation comes from the Bin Qasim Power Plant, which has an installed capacity of 1,260MW. Another 500MW comes from smaller units. Since privatization, KESC has added another 500WM capacity at Bin Qasim but its output has remained erratic because of the inconsistent supply of gas.

Experts blame many of Pakistan’s problems on the “ circular debt ,” which mainly arises because of the poor recovery of receivables by the distribution companies. It is estimated that for every 100 units of electricity provided by a distribution company, it gets paid for 30. Of the remaining 70 units, nearly 40 are pilfered and the bills for the remaining 30 go to long-term receivables. Corrupt utility executives and workers contribute to this dismal state.

After privatization, KESC’s new management tried to right size the company, but the move was resisted by employees, who enjoy significant political support. At any rate, analysts acknowledge that human resource costs may be high but it is transmission and distribution losses that really trouble KESC. These losses currently hover at around 35%, mostly because of theft. A one percent improvement would improve the company’s cash flow by Rs1.5 billion per month.

To overcome its electricity shortage, Pakistan has to come up with policies for the short, medium and long terms. The first step for the short term has been taken by clearing outstanding debt. Now, supporting policies must be prepared and implemented to ensure that circular debt does not rebuild. This requires containing theft and improving recovery. A hike in the electricity tariff could improve cash flow at distribution companies, but opponents argue that a higher tariff itself provides an incentive to pilfer electricity. They say the government should ensure an uninterrupted supply of electricity at affordable cost.

As a medium-term policy, all power plants operating in the public sector need to be refurbished to improve efficiency, which will help bring down the cost of generation. However, the focus should be on achieving the highest possible output from hydro power, where the cost of generation is still Rs2.00/units, compared to the bulk power purchase tariff of US$0.70/unit being paid to IPPs, mostly being run on furnace oil.

Simultaneously, efforts should be made to switch power plants from furnace oil to coal. Gas should be avoided. To begin with, power plants could use imported coal, but ultimately they will need to use an indigenous source. In this endeavor, Lakhra Power Plant near Karachi, which has been closed for some time, must be reactivated as soon as possible. It uses coal produced at nearby mines.

Under long-term measures, the government must prioritize the completion of the Thar Power Plant. Thar has more than 185 billion tons of lignite coal, suitable for mine-mouth power plants . It is estimated that Pakistan could generate more than 50,000MW of power from Thar coal alone.

Experts say Pakistan should focus on hydro generation as the country has the potential to produce 40,000MW by constructing small and midsize dams and run-of-the-river projects . Two of the latter type (Ghazi-Broth and Laraib) are already in operation. The advantages of these projects are minimum displacement of people and minimum areas under water. An added advantage is the renewable aspect.

Pakistan also has the potential to get electricity from sugar plants located across the country, especially in rural areas. Some industry experts suggest that sugar mills could deliver up to 3,000MW to the national grid. This option is very lucrative, because sugar mills will mostly use very low-cost bagasse to heat the boilers, using furnace oil only as a supplement.

Yet another advantage of sugar mills is that they have the capacity to produce ethanol, which can be added to motor gasoline to produce E-10 (petrol containing 10% ethanol). This will help contain oil imports and conserve compressed natural gas.

As the saying goes, there is opportunity in crisis, and this certainly applies to Pakistan’s energy sector. Notwithstanding the significant challenges, a large market and an enthusiastic government could entice bold investors, local and foreign.

Shabbir H. Kazmi is an economic analyst.

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Energy Crisis in Pakistan Proposal

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Energy is an essential component of the growth and development of the economy. It is due to this fact that all governments in the world strive to ensure that the energy availability within their nations meets their needs and requirements (UKERC, 2012). This is due to the fact that each and every industry within the economy requires energy in one form or anther.

As Ahmad (2009) asserted, energy is the backbone which growth and development are based upon. Industry, agriculture, transportation, education and the service industry all require energy to ensure that all their operations are conducted effectively and efficiently. Therefore, it will be difficult for a nation that is not able to meet its energy requirements to achieve its short term and long-term goals and objectives (Peters, 2010).

In history, man has come up with a lot of discoveries and innovations. This has transformed the manner in which we operate, interact with each other and interact with ourselves. The life that we are currently in highly depends on technology. Therefore technology is the basis on which the worlds economy thrives upon (ElBaradei, 2012).

The origin of modern technology can be traced back to the era of industrial revolution in Europe. It is during this time that a lot of discoveries and advancement were made in the field of industry. During this period, man came up with a variety of machines and mechanisms that replaced the human effort in the process of production in terms of labour.

These machines were more effective and efficient and hence, the process of production was enhanced. It is due to this fact that goods were produced more cheaply in bulk in order to meet the market demand. As a result of high efficiency in production and reported high sales, economic growth was experienced. The standards of living of people have been improved and the GDP of nations also increased (ElBaradei, 2012).

However, in the process of industrial revolution, a key ingredient was responsible for the success that was being experienced at that time. This was energy. The availability of energy was and still is an essential ingredient of the production process. From this realisation, man has always strived to come up with cheaper and better alternative sources of energy.

A lot of money is spent on research and development programs in a bid to come up with cheaper, better and safer sources of energy (Iqbal, 2012). During the industrial revolution, the most common source of energy was coal. However, with advancements in technology, other sources of energy have been realised.

At the present moment, the most common source of energy that is used in the world is electricity (Iqbal, 2012). However, due to its demand, the availability of this form of energy has been declining over the last decade.

Pakistan is one of the nations that has been experiencing power shortages. For the last several decades, the country has been experiencing oil, gas and electricity shortages. All the regimes that have come to power have always promised to come up with a solution to this predicament.

In the process, these governments have come up with policies and plans to end the energy crisis in the nation but none of these goals or objectives have ever been realised. However, this situation has become worse within the last four years. This has mainly been triggered by the changing weather patterns in the globe and the rise in global oil prices.

At the same time, the situation has been made worse during this period that Musharraf is in office (Ahmad, 2009). Several allegations have been linked to this government in terms of misappropriation of public funds and corruption (Ahmad, 2009). As a result, it has been difficult for the nation to meet its short term and long-term goals and objectives.

It is due to this fact that the nation has been unable to meet its power demands and more importantly being unable to enhance its electricity production activities. Therefore, the nation has been experiencing massive blackouts. This situation has become even worse within the last four years. The increase in population and the rising level of urbanization have made the situation to become even worse (Ahmad, 2009).

This has made the nation unable to meet its ever-increasing demand for electricity. As a result, it is common for urban areas to experience blackouts for more than 8 hours a day (Ahmad, 2011). The situation is even worse in rural areas since power blackouts last between 12-16 hours in a day.

In recent years, violent protests have emerged as a result of retaliation to the power crisis that the nation is experiencing. In 2010, violent protests emerged in several parts of the nation, especially major cities of Pakistan in retaliation to the power blackouts and insufficient availability of energy in the nation (Ahmad, 2011). These violent acts led to arsons and looting in the regions that were affected.

Despite of these acts, the government has still been reluctant in improving the situation. This resulted into the reoccurrence of similar situations in 2011 (Ahmad, 2011). At the same time, several business entities have been shut down due to this predicament.

As Ahmad (2011) asserted, due to the unavailability of power during business operating hours of the say, small and medium scale businesses in major cities have found it hard to keep their operations going due to the lack of electricity.

Most of these businesses that have been shut down are in the service industry that relies mainly on power for their operations (Davis, 2011). This has left thousands of people jobless; a heavy blow towards achieving economic sustainability.

According to Ahmad (2009), by 2009, Pakistan had a power deficit of approximately 3,500 mega watts (MW). On the other hand, industries that have been shut down accounted for approximately 1,500 to 2,000 MW. Therefore, the total power deficit that the nation was experiencing as per 2009 was around 5,000 MW.

According to analysts, this figure was expected to rise in the coming years if the government do not take corrective measures to resolve the situation. As per the present moment, the ministry of Water and Energy and the Ministry of Petroleum and Natural Resources has not come up with means through which electricity production within the nation can be boosted.

Therefore, the situation is expected to become even worse given the fact that the prices on oil have always been rising. At the same time, weather patterns have been changing due to global warming. As a result, there has been reduction in rainfall and prolonged dry season. This has resulted in the decline of water in dams where hydroelectric power is being generated within the nation (Zimmerman, 2010).

In order to determine the welfare of people within a community, one of the indicators that analysts use is energy consumption (Ahmad, 2009). The energy consumption per capita is the index that is used to give the required results of such a study with regards to the constrain at hand.

The energy consumption in Malaysia is approximated to be 104MMBtu. At the same time, the energy consumption of Iran is 106MMBtu. The average of Europes electricity consumption as per 2009 was 170MMBtu. During the same year, the words electricity consumption was at 68MMBtu. However, for 2009, the power consumption of Pakistan was at 15MMBtu (Ahmad, 2009).

This made the nation to be ranked among the lowest in the world. Therefore, according to Ahmad (2009), for Pakistan to ensure that it copes with its ever-increasing energy demands, it needs to increase its electrical power output by at least 50% during its short-term period of 2012-2020.

Therefore, for Pakistan to ensure that its economic growth is guaranteed, it needs to ensure that the availability of energy is capable of meeting its mixed demand within the nation. In Pakistan, electricity is mainly used for three major purposes; industrial, commercial and domestic (Ahmad, 2009).

The government is thus expected to come up with sustainable solutions that will ensure that power is available to all these users at an affordable price range (Ahmad, 2009). At the same time, the government needs to ensure that not only the process of power production will be increased but the entire supply and distribution of the resource will be well maintained.

Currently, the major source of electricity in Pakistan is from hydel power. According to (Ahmad, 2009), this is the most economical form that electricity can be generated from in Pakistan. Hydroelectric power is also another alternative. However, given the changing weather patterns and the fact that water levels fluctuate between summer and winter, hydroelectric power production in Pakistan had been reduced by 70% by 2009.

It is due to this fact that the nation is in dire need for an alternative source of power in order to meet its ever-rising demand of power for domestic, commercial and industrial uses (Ahmad, 2009). One of the proposed sources of electrical energy in Pakistan has been from wind power. This source of energy has been advocated for since it is relatively easier to harness.

At the same time, this source of energy is deemed to be environmentally friendly since it does not have any adverse effects on man and the environment in terms of pollution (Ahmad, 2009). These factors have made many people to believe that wind energy is one of the most sustainable sources of electricity in the nation and hence one of the key solutions that should be used to alleviate the energy crisis that the nation is in.

However, from an economical point of view, the costs incurred in producing electricity using this option is much higher as compared to hydel power. While the cost of hydel power is at 6 cents per kWh (kilowatt-hour), the cost of wind energy is estimated to be around 13 cents per kilowatt hour (Ahmad, 2009).

This ideally makes wind energy not the best solution to the current situation. However, despite the fact that wind energy might be an expensive option, it should not be ruled out as a source of alternative energy in the nation since it may be sustainable in the long run given the fact that technological advancement may increase the efficiency of wind power production and reduce the costs at the same time.

Therefore, to ensure that the nation is able to meet its power demands, it is essential for Pakistan to re-check its power mix status. At the present moment, natural gas is the main source that is used to generate electricity in Pakistan at 47%. It is followed by oil at 31%. Hydroelectricity and coal stand at 11% and 10% respectively. Nuclear power forms the lowest proportion as it only accounts for 1.2% (Ahmad, 2009).

The government has always been in talks to revive the energy sector of the nation. Despite the fact that none of the strategies that it has come up with has been implemented, the nations hopes are still held up high by the 2030 energy plan of Pakistan (Ahmad, 2009). According to this plan, the power output of the nation is expected to be increased by more than 60%.

The proposed power mix of this plan in terms of generation of electricity will focus more on the use of coal to replace gas. According to this power mix, the use of coal to produce electricity will be increased by 30% while the use of gas shall decline from 47% to 35%.

At the same time, hydroelectric production is expected to rise to 20% while nuclear power production shall be boosted to 3%. The use of oil shall be reduced to 10%. If effected, this power plan will be effective in ensuring that Pakistan is able to meet its energy requirements.

Ahmad, M. 2009, Pakistan energy crisis. Web.

Ahmad, K. 2011, Energy shortage deepens crisis in Pakistan. Web.

Davis, D. 2011, Alternative Source of Energy , Sage, New York

ElBaradei, M. 2012, Tackling the global energy crisis. Web.

Iqbal, S. 2012, energy crisis causes and remedies. Web.

Peters, S. 2010, Sustainable use of resources, Sage, London

UKERC 2012, Energy demand. Web.

Zimmerman, S. 2010, ‘Nuclear Power: The Way Forward’, The Bell Journal of Economics, vol. 1 no. 4, pp. 16-31

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Electricity Crisis in Pakistan Essay

This topic is related to the Electricity Crisis in Pakistan Essay and it is one of the major reasons which are hindering the economic growth of Pakistan. The unavailability of power is affecting directly or indirectly every sector of life. Making people feel frustrated as well as helpless. The load-shedding span has amounted to almost 6 hours a day for industries and about 4 hours for domestic consumers. This destructive power shortage has brought the industrialist as well as the local people on the roads for an urge of protest, but despite all such anti-government actions this struggle is in vain as there is no progress in the electricity supply to the consumers. Due to the unavailability of electricity Pakistan’s export is highly affected as industries are unable to meet up to the orders leaving their clients with no other option instead of switching to other vendors in other countries.

Electricity Crisis in Pakistan

This is not only about the export but the national producers are shifting their production plants to nearby countries like Bangladesh and China where electricity supply is convenient and side by side cheap. In the past 4 years, modern cities are experiencing about 8-12 hours of load shedding as compared to the rural areas where load shedding has to accede to almost 12-14 hours of load shedding. This Electricity Crisis in Pakistan is also affecting the gross domestic product of our country as the country’s GDP is decreasing to 2% every passing year indicating a destructive economic breakdown in the near future if this problem is not coped up.

This Electricity Crisis in Pakistan is ultimately becoming the major cause of increasing unemployment in our country. There is no electricity so industries are being forced to fully shut down leaving the labor and employees helpless and without any jobs. It is stated that in the last 3 years, thousands of employees who have lost their job due to this energy crisis have returned to their homes from where they have come in search of jobs. Many of the orders were canceled in industries and were not canceled and never met the prescribed standards and quality. Karachi Electric Supply Corporation (KESC) is blamed for this electricity shortage but according to them they are also handcuffed by the gas suppliers as they required 22 million cubic feet of gas for normal production which is reduced to about 115 million cubic meters a day, so when there will be no fuel there will be no electricity produced. So, in conclusion, Pakistan is facing one of the most disparaging and critical Electricity crises in Pakistan and if it is not resolved as a major priority Pakistan’s economy which is still not developed will be in real-time danger.

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Household electricity consumption has grown at an average annual rate of 10% over the last 42 years. During this time, the government also actively pursued a policy of rapid electrification of rural areas. As a result, the share of households in total electricity consumption increased from 12% in 1971-72 to 47% in 2000-01.
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Essay on “Energy Crisis in Pakistan” for CSS, PMS, Judiciary Examinations

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