energy crisis in pakistan essay 120 words

Essay On Energy Crisis In Pakistan (200 & 500 words)

Essay on energy crisis in pakistan (200 words).

Pakistan faces a severe energy crisis due to a lack of resources, poor management, and an inefficient distribution system. The country is heavily dependent on imported oil, which has led to high costs and volatility in energy prices. This has resulted in frequent power outages and load shedding, devastatingly impacting the economy and people’s lives.

The energy crisis has significantly impacted Pakistan’s economy, particularly its manufacturing sector, which has been forced to shut down due to power shortages. As a result, unemployment has increased, and foreign investment has decreased. The energy crisis has also affected the agriculture sector, a major contributor to the country’s economy. Farmers have been unable to irrigate their crops, leading to lower yields and higher food prices.

Pakistan has significant potential for renewable energy sources, such as solar and wind power. However, the government has not invested enough in this area, and the country still relies heavily on fossil fuels. There is also a need for better energy sector management, including improved distribution systems and reduced transmission losses.

In conclusion, the energy crisis in Pakistan is a complex issue that requires a multi-faceted approach to address. The government must invest in renewable energy sources, improve management, and reduce transmission losses. It is essential to address this crisis to support economic growth, create employment opportunities, and improve the lives of Pakistanis.

Essay On Energy Crisis In Pakistan (500 words)

Like many other developing countries, Pakistan is grappling with an acute energy crisis that severely affects its economy, industry, and social development. The country has been facing severe energy shortages for the past decade, resulting in frequent power outages, load shedding, and rising energy costs. The energy crisis in Pakistan is a complex issue with multiple causes and requires a comprehensive strategy to address it.

The energy crisis in Pakistan can be traced back to the 1990s, when the country began to experience a growing demand for energy due to rapid population growth, urbanization, and industrialization. At the same time, there was a lack of investment in the energy sector, resulting in an inadequate supply of electricity, gas, and oil. The government’s failure to address the issue promptly and effectively has exacerbated the situation.

One of the leading causes of the energy crisis in Pakistan is the over-reliance on non-renewable energy sources such as oil and gas. The country has limited domestic reserves of these resources and must rely on imports to meet its energy needs. This has led to a significant increase in energy costs and has made the economy vulnerable to global oil price fluctuations.

Another significant factor contributing to the energy crisis in Pakistan is the inefficient and outdated energy infrastructure. The country’s power generation and distribution system is outdated, and many of the power plants are running on obsolete technology. The transmission and distribution systems are outdated and suffer significant losses, resulting in low efficiency and frequent power outages.

Moreover, the lack of investment in renewable energy sources such as solar, wind, and hydro has exacerbated the energy crisis in Pakistan. The country has enormous potential for renewable energy, especially solar and wind, but there has been a lack of political will and investment in this area. The government must encourage private sector investment in renewable energy to diversify the country’s energy mix and reduce its dependence on non-renewable sources.

The energy crisis in Pakistan has had severe economic and social consequences. The frequent power outages and load shedding have had a detrimental impact on the country’s industry and businesses, resulting in lost productivity and economic growth. The rising energy costs have also made it challenging for businesses to operate profitably, resulting in job losses and economic instability. Moreover, the lack of access to electricity has severely impacted the country’s rural population, making it challenging to access healthcare, education, and other essential services.

To address the energy crisis in Pakistan, the government needs to adopt a comprehensive strategy that includes a mix of short-term and long-term measures. In the short term, the government must invest in upgrading the existing energy infrastructure, including power plants, transmission lines, and distribution systems. The government should also promote energy conservation and efficiency measures, such as incentivizing energy-efficient appliances and adopting renewable energy sources.

In the long term, the government must invest in renewable energy sources such as solar, wind, and hydro. The country has enormous potential for these sources and can significantly reduce its dependence on non-renewable sources. The government must encourage private sector investment in these areas and create a favorable regulatory environment to attract investment.

In conclusion, the energy crisis in Pakistan is a complex issue that requires a comprehensive strategy to address it. The government needs to take immediate steps to upgrade the energy infrastructure, promote energy conservation and efficiency measures, and encourage private sector investment in renewable energy sources. Failure to address the issue will have severe economic and social consequences for the country and its people.

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Sana Mursleen is a student studying English Literature at Lahore Garrison University (LGU). With her love for writing and humor, she writes essays for Top Study World. Sana is an avid reader and has a passion for history, politics, and social issues.

Energy Crisis in Pakistan Essay: A Looming Challenge

• October 18, 2023

Energy plays a fundamental role in any nation’s progress, and Pakistan is no exception. In recent decades, Pakistan has been grappling with a severe energy crisis that has had far-reaching consequences on its economy, society, and environment. This essay delves into the intricacies of the energy crisis in Pakistan, its root causes, and the profound impact it has on the nation. Moreover, it outlines potential solutions, examines case studies from around the world, and sheds light on the challenges that impede progress. By the end, we aim to provide a comprehensive understanding of the energy crisis in Pakistan and the steps needed to address it.

Causes of the Energy Crisis

Impact on the economy, society, and environment, the role of different energy sources, government policies and initiatives, effects on industries and manufacturing, impact on household and agriculture, unemployment and economic instability, energy affordability and access for the poor, air pollution and greenhouse gas emissions, water usage and contamination, ecological impact of energy projects, potential for renewable energy development, researched and statical data, improving energy efficiency and conservation, diversifying the energy mix, enhancing the energy infrastructure, reducing transmission and distribution losses, encouraging private sector involvement, promoting renewable energy sources, policy reforms and regulatory changes, examining successful energy initiatives in other countries, political challenges, economic constraints, technological limitations, public awareness and participation, anticipated improvements in pakistan’s energy sector, the role of innovation and technology, long-term energy sustainability goals, historical perspective on pakistan’s energy situation.

To comprehend the current energy crisis in Pakistan, it’s essential to trace its historical evolution. Over the years, Pakistan has faced a growing demand for energy, driven by its burgeoning population and industrialization. Initially, the country had a relatively stable energy sector. However, several factors contributed to the eventual crisis.

The energy crisis in Pakistan can be attributed to a multitude of factors:

• Insufficient Energy Production : One of the primary causes is the inability to generate an adequate amount of energy to meet the increasing demand. This stems from a lack of investment in the energy sector and outdated power generation facilities.
• Transmission and Distribution Losses : A significant portion of the energy generated is lost due to inefficient transmission and distribution systems. This not only exacerbates the crisis but also strains the economy.
• Dependence on Non-Renewable Energy Sources : Pakistan heavily relies on non-renewable energy sources, primarily fossil fuels, such as coal, natural gas, and oil. The dependence on these finite resources makes the energy sector vulnerable to price fluctuations and supply disruptions.
• Economic and Political Factors : Economic challenges, including circular debt in the energy sector, have impeded progress. Political factors, such as policy inconsistency and governance issues, have also played a detrimental role.

The energy crisis has far-reaching consequences:

• Economic Impact : Frequent power outages disrupt industrial operations and lead to financial losses. This hampers economic growth, foreign investment, and job creation.
• Social Implications : Households and agricultural activities suffer due to power cuts, impacting the quality of life. Access to reliable energy becomes a privilege, rather than a basic necessity.
• Environmental Consequences : Overreliance on fossil fuels results in air pollution and greenhouse gas emissions. Furthermore, energy projects often have adverse ecological effects.

The energy crisis in Pakistan is a complex issue with multifaceted causes and consequences. Addressing it requires a comprehensive understanding of the nation’s energy landscape.

Energy Demand and Supply Gap

As of the present day, Pakistan continues to grapple with a significant energy demand and supply gap. The rapidly growing population and increasing industrialization have driven up the need for electricity and other forms of energy. Unfortunately, the country’s energy production has not kept pace with this rising demand.

To understand the current energy scenario, it’s essential to examine the role of various energy sources:

• Fossil Fuels : Pakistan predominantly relies on fossil fuels for its energy needs. Coal, natural gas, and oil power a significant portion of the country’s energy grid. However, this dependence on non-renewable sources makes Pakistan vulnerable to international price fluctuations and supply disruptions.
• Renewable Energy : Although Pakistan has made strides in harnessing renewable energy sources such as hydro, wind, and solar power, their contribution to the overall energy mix remains relatively small. Embracing renewable energy is pivotal to achieving a more sustainable and diversified energy landscape.

The Pakistani government has taken several steps to address the energy crisis:

• Power Generation Projects : Various power generation projects have been initiated to increase the capacity and reduce the demand-supply gap. Investments in modern and efficient power plants have been made.
• Energy Conservation Measures : Efforts to promote energy conservation and efficiency include encouraging the use of energy-efficient appliances, improving building codes, and implementing energy-saving practices in industries.
• International Collaborations : Pakistan has sought international assistance and collaborations to bolster its energy sector. Agreements with other countries for the construction of power plants and infrastructure development have been established.

Despite these initiatives, the energy crisis persists, and comprehensive measures are required to bridge the gap between demand and supply.

Socioeconomic Consequences

we will explore the socioeconomic consequences of the energy crisis in Pakistan and its environmental implications, shedding light on the multifaceted nature of the problem and its pervasive impact on society and nature.

The energy crisis in Pakistan has taken a heavy toll on the industrial and manufacturing sectors. Power outages disrupt production processes, leading to financial losses and hampering economic growth. Industries struggle to meet deadlines, which can deter foreign investment and hinder the creation of new job opportunities. As a result, the lack of reliable energy has become a significant roadblock to industrial development and economic stability.

For the average citizen in Pakistan, the energy crisis translates into daily inconveniences. Frequent power cuts disrupt daily life, affecting everything from household chores to education and entertainment. In rural areas, where agriculture is a vital source of livelihood, irregular access to electricity impedes irrigation and the use of modern farming equipment. Crop yields are affected, leading to food security concerns.

The energy crisis also has repercussions on employment. Reduced industrial output and limited job opportunities in the manufacturing sector have contributed to unemployment. Moreover, the economic instability resulting from the crisis discourages investment and business growth, further exacerbating the unemployment issue.

Energy affordability is a critical concern. As energy costs rise due to the energy crisis, the poorest segments of the population struggle to meet their basic energy needs. Access to electricity and clean cooking fuels remains a challenge for many, perpetuating poverty and inequality.

The socioeconomic consequences of the energy crisis in Pakistan are profound and multifaceted, affecting individuals, industries, and the nation’s overall economic stability.

Environmental Implications

In the following we will delve into the environmental implications, including air pollution, water usage, and ecological impact, which are an integral part of this crisis.

One of the most pressing concerns related to Pakistan’s energy crisis is the environmental impact. The heavy reliance on fossil fuels, especially in the power generation sector, leads to significant air pollution. Emissions of particulate matter, sulfur dioxide, and nitrogen oxides from these sources contribute to poor air quality in many urban areas.

The emission of greenhouse gases, such as carbon dioxide, from the burning of fossil fuels exacerbates global climate change. Pakistan, like the rest of the world, is experiencing the consequences of a changing climate, including more frequent and severe weather events.

Energy production in Pakistan often involves water-intensive processes. Hydroelectric power generation, for example, relies on water reservoirs, which can impact local ecosystems and water availability. Additionally, the extraction and processing of fossil fuels can contaminate water sources, posing risks to both the environment and public health.

Large-scale energy projects, whether they involve the construction of dams for hydroelectric power or coal-fired power plants, often have direct ecological consequences. Dams can alter river ecosystems and impact aquatic life, while coal mining and power plants can lead to deforestation, habitat destruction, and long-term environmental degradation.

Transitioning to renewable energy sources offers a path to mitigate many of these environmental concerns. Solar, wind, and hydroelectric power have a significantly lower environmental footprint compared to fossil fuels. Embracing these sustainable alternatives can reduce air pollution, water usage, and ecological impact while also contributing to a more sustainable energy future.

Pakistan has been facing an energy crisis for over a decade, which has had a significant impact on the country’s economy and people’s livelihoods [4] . Here are some researched and statistical data related to the Pakistan energy crisis:

• Pakistan started to face severe electricity shortages in 2006, which have worsened over time [1].
• Pakistan’s electricity shortfall is currently around 5,000 megawatts (MW) per day, and the gas shortfall is 2 billion cubic feet per day [5] .
• The energy crisis has been a major drag on the economy, with an estimated cost of 10% of the GDP over the past 5 years [4].
• The energy shortages are estimated to cost around 2% of GDP annually [5].
• The electricity demand in Pakistan has been increasing rapidly, and the country does not produce enough energy to meet demand [3].
• The renewable energy sector in Pakistan has been growing, and it has been suggested as a remedy for the energy crisis [1].
• Pakistan has a significant potential for renewable energy, including solar, wind, and hydropower [4].
• The government of Pakistan has been pursuing short-, medium-, and long-term solutions to address the energy crisis [3].
• The energy crisis in Pakistan has been a possible source of regional conflict [3].
• https://www.mdpi.com/1996-1073/11/9/2424
• https://www.iea.org/countries/pakistan
• https://www.usip.org/sites/default/files/PW79_Pakistans_Energy_Crisis.pdf
• https://www.mdpi.com/1996-1073/16/1/423
• https://www.usip.org/sites/default/files/SR375-Pakistans-Power-Crisis-The-Way-Forward.pdf

[1] https://www.mdpi.com/1996-1073/11/9/2424 [2] https://www.iea.org/countries/pakistan [3] https://www.usip.org/sites/default/files/PW79_Pakistans_Energy_Crisis.pdf [4] https://www.mdpi.com/1996-1073/16/1/423 [5] https://www.usip.org/sites/default/files/SR375-Pakistans-Power-Crisis-The-Way-Forward.pdf [6] https://www.sciencedirect.com/science/article/pii/S2211467X2200013X

Solutions and Recommendations

In the following, we will explore potential solutions to the energy crisis in Pakistan, including strategies to improve energy efficiency, diversify the energy mix, enhance infrastructure, and promote renewable energy sources. Addressing these environmental concerns is an integral part of any comprehensive solution to the crisis.

Efforts to improve energy efficiency and conservation are pivotal in addressing the energy crisis. This includes:

• Promoting Energy-Efficient Technologies : Encouraging the use of energy-efficient appliances, industrial processes, and building designs can significantly reduce energy consumption.
• Energy Audits and Management : Conducting energy audits and implementing effective energy management systems in industries and institutions can identify areas of waste and inefficiency.

To reduce Pakistan’s vulnerability to fossil fuel price fluctuations and supply disruptions, diversification of the energy mix is essential. This involves:

• Expanding Renewable Energy : Scaling up the use of renewable energy sources like solar, wind, and hydropower can provide a more stable and sustainable energy supply.
• Nuclear Energy : Exploring the potential for nuclear energy can provide a reliable source of power, though this comes with its own set of challenges, including safety and waste management.

Investing in infrastructure improvements is crucial for ensuring a reliable energy supply. This includes:

• Upgrading Transmission and Distribution Systems : Reducing losses in the transmission and distribution of electricity can help bridge the demand-supply gap.
• Grid Modernization : Implementing a modern smart grid system can improve energy distribution and reduce waste.

A significant portion of the energy crisis is due to losses in the transmission and distribution of electricity. Measures to address this issue include:

• Technical Upgrades : Modernizing and upgrading the existing infrastructure to minimize losses.
• Loss Monitoring and Management : Implementing systems to continuously monitor and manage losses to prevent theft and inefficiencies.

The private sector can play a crucial role in addressing the energy crisis. The government should create an enabling environment for private investment by offering incentives and removing regulatory barriers.

Government policies should encourage and support the growth of renewable energy:

• Incentives : Providing financial incentives, such as tax breaks and subsidies, to entities investing in renewable energy projects.
• Net Metering : Implementing net metering policies to allow individuals and businesses to feed excess renewable energy back into the grid.

Addressing the energy crisis in Pakistan requires significant policy reforms:

• Energy Pricing : Rationalizing energy prices to reflect true costs can reduce inefficiency and wastage.
• Policy Consistency : Ensuring consistency in energy policies to attract investment and promote long-term planning.

Case Studies

In the following, we will explore international case studies to draw valuable lessons from successful energy initiatives around the world. These lessons can provide valuable insights for Pakistan as it works towards addressing its energy crisis.

To address the energy crisis in Pakistan, it’s valuable to draw insights from successful energy initiatives in other nations. Several countries have effectively managed their energy challenges and can serve as models for Pakistan’s energy reform efforts.

• Germany’s Energiewende : Germany’s transition to renewable energy, known as “Energiewende,” has shown that a commitment to renewables and energy efficiency can reduce carbon emissions and create a sustainable energy future.
• China’s Renewable Energy Expansion : China’s aggressive investment in renewable energy, particularly in solar and wind, demonstrates the potential for rapid growth in these sectors.
• Norway’s Hydroelectric Power : Norway’s extensive use of hydroelectric power provides a model for effective utilization of renewable energy sources, which Pakistan can also tap into given its geographical features.
• South Korea’s Nuclear Energy : South Korea’s experience in developing and managing nuclear power can offer insights into safe and efficient nuclear energy utilization.

By studying these case studies and adopting successful strategies, Pakistan can chart a more sustainable and resilient energy future.

Challenges and Barriers

In this we will delve into the challenges and barriers that impede Pakistan’s progress in addressing the energy crisis. Understanding these challenges is crucial to developing effective solutions.

Political instability, lack of consensus on energy policies, and reluctance to implement necessary reforms can hinder progress. Addressing these issues requires strong leadership and bipartisan cooperation.

The economic challenges associated with circular debt, subsidies, and financial mismanagement in the energy sector are significant hurdles. Resolving these issues will require careful financial planning and structural reforms.

The outdated infrastructure and technology in the energy sector need substantial upgrades. Embracing modern technology and innovation is vital to enhancing efficiency and reducing losses.

Engaging the public in energy conservation and sustainable practices is essential. Public awareness campaigns and education can foster a culture of responsible energy use.

Future Outlook

In the final we will explore the future outlook for Pakistan’s energy sector, highlighting anticipated improvements, the role of innovation and technology, and long-term energy sustainability goals.

Despite the formidable challenges, there is room for optimism regarding Pakistan’s energy future. Several developments are expected to improve the energy landscape in the coming years:

• Investment : Increasing domestic and foreign investments in the energy sector, coupled with better financial management, can help alleviate economic constraints and spur infrastructure development.
• Policy Reforms : Ongoing policy reforms and consistency in energy policies can provide a conducive environment for the private sector and facilitate the transition to cleaner and more sustainable energy sources.
• Technological Advancements : The integration of advanced technologies, such as smart grids and energy storage solutions, can enhance the efficiency and reliability of energy distribution.
• International Support : Collaborations with other nations and international organizations can bring expertise, funding, and technical assistance to Pakistan’s energy projects.

Innovation and technology will play a pivotal role in shaping Pakistan’s energy sector:

• Renewable Energy Innovations : Advances in solar and wind energy technologies are making these sources more affordable and efficient, making them increasingly viable for Pakistan’s energy needs.
• Smart Grids and Energy Storage : Smart grid technology can improve the management and distribution of energy, while energy storage solutions can help mitigate supply challenges.
• Clean Energy Research : Ongoing research into cleaner and more efficient energy production methods can accelerate Pakistan’s transition towards a more sustainable energy mix.

Looking ahead, Pakistan must establish long-term sustainability goals for its energy sector:

• Reducing Emissions : Committing to lower greenhouse gas emissions through the increased use of renewables and more efficient energy generation methods.
• Energy Access for All : Ensuring universal access to reliable and affordable energy, particularly for the underprivileged, is a crucial long-term goal.
• Resource Diversification : A diversified energy mix that reduces reliance on fossil fuels and promotes renewables is pivotal for long-term sustainability.

The energy crisis in Pakistan is a complex challenge with profound implications. However, with a strategic approach that includes policy reforms, technological innovation, and international collaboration, Pakistan can transition towards a more sustainable, reliable, and efficient energy system that benefits its economy, society, and environment. It is imperative for the nation to work towards these goals to secure a brighter energy future for its citizens.

Welcome to the official author account of words.pk! I am a passionate writer and researcher who loves exploring the rich and diverse culture of Pakistan. Through my writing, I aim to showcase the beauty and complexity of this vibrant nation, from its history and traditions to its art, music, cuisine, and more. With years of experience in blogging, and content creation, I have honed my skills in storytelling and crafting compelling narratives that captivate readers

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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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Energy Crisis in Pakistan; Causes, Impacts and Remedies

• Current Affairs , Essays, Outlines
• May 31, 2023
• Noshin Bashir

Table of Contents

Introduction

Pakistan is a developing country in South Asia with a population of over 200 million people. Despite having abundant natural resources, including coal, natural gas, and hydropower potential, the country has been facing an energy crisis since 2007. The energy crisis in Pakistan is a complex and multi-dimensional issue that has had severe economic, social, and political consequences for the country. It has caused a significant economic and social impact on the country. The energy crisis is caused by a variety of factors, including an inadequate energy supply, an inefficient energy sector, and a lack of investment in the sector.

Root Causes of Energy Crises in Pakistan

The root causes of the energy crisis in Pakistan are numerous, including poor governance, inadequate investment in the energy sector, and a lack of foresight in energy planning. Pakistan’s energy sector is highly dependent on imported oil and gas, and the country has been struggling to meet its energy demand, which has been growing at a rate of around 7% per annum.

One of the primary reasons for the energy crisis in Pakistan is the circular debt issue. Circular debt refers to the outstanding payments between the government, power generation companies, and distribution companies. The circular debt has been increasing over the years, and it has resulted in power generation companies being unable to pay for the fuel required to produce electricity. As a result, they have been forced to reduce their output, resulting in widespread power outages across the country.

Another significant contributor to the energy crisis in Pakistan is the country’s inadequate investment in the energy sector. The lack of investment in the power generation and transmission infrastructure has resulted in frequent power outages and load shedding. The country’s aging power plants are also a significant contributor to the energy crisis. The majority of the power plants in Pakistan are more than 30 years old, and they have been operating inefficiently, resulting in low power generation and high fuel consumption.

Pakistan’s reliance on imported oil and gas is another significant reason for the energy crisis. The country has been importing approximately 80% of its oil and gas requirements, which has resulted in high energy costs. The rising oil prices have put a considerable strain on the country’s economy and have contributed to inflation.

Impacts of Energy Crises

The energy crisis in Pakistan has had severe economic, social, and political consequences. The power outages and load shedding have resulted in a loss of productivity and have had a detrimental effect on the country’s economy. The frequent power outages have also had a negative impact on the healthcare and education sectors, as hospitals and schools have been unable to function without electricity. The cost of electricity has increased significantly, leading to an increase in the cost of living. In addition, the energy crisis has caused a decrease in industrial production, leading to a decrease in employment and a decrease in economic growth.

The energy crisis has also had a significant social impact on the country. The lack of electricity has caused a decrease in the quality of life, as people are unable to access basic services such as healthcare, education, and transportation. In addition, the energy crisis has caused an increase in crime and social unrest, as people are unable to access basic services.

How to Address Energy Crises

To address the energy crisis in Pakistan, the government must take steps to increase investment in the energy sector. This includes investing in infrastructure, modernizing existing infrastructure, and investing in renewable energy sources. In addition, the government must take steps to improve the efficiency of the energy sector, such as introducing energy efficiency measures and improving the regulation of the energy sector. Finally, the government must take steps to reduce energy costs, such as introducing subsidies and incentives for energy efficiency.

The Pakistani government also needs to address the circular debt issue and take steps to improve the investment climate in the energy sector. The country needs to invest in modern power generation technologies and focus on developing renewable energy sources such as solar, wind, and hydropower.

The energy crisis in Pakistan is a complex and multi-dimensional issue that requires urgent attention. It is a major issue that has had a significant economic and social impact on the country. The government must take steps to address the energy crisis, such as increasing investment in the energy sector, improving the efficiency of the energy sector, and reducing energy costs. These steps will help to reduce the impact of the energy crisis on the country and ensure that the country is able to meet its energy needs.

Read Also: The Balochistan Crisis: Origins, Impacts, and Remedies

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Home → Articles → Essay on Energy Crisis in Pakistan

Written by Ayesha Zafar • December 28, 2021 • 12:00 pm • Articles , Current Affairs , Pakistan , Published Content • One Comment

Essay on Energy Crisis in Pakistan

Ms Ayesha Zafar is currently pursuing her Bachelor's in International Relations from National Defence University, Islamabad. She has authored multiple academic publications including research articles and book chapters. Her areas of interest include Middle Eastern politics, the geopolitics of Central Asia, and the Indo-Pacific region

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Causes of Energy Crisis: A Brief Overview

The global energy crisis, arising from a demand-supply imbalance exacerbated by natural disasters, political instability, economic growth, and technological changes, is currently intensified by the post-COVID-19 economic recovery, the war in Ukraine, and diverse weather conditions. This crisis is notably impactful in Pakistan, marked by electricity and oil and gas shortages, causing prolonged outages, disruptions, electricity theft, and price hikes.

The challenges in Pakistan involve population growth straining electricity demand, inadequate infrastructure, reliance on costly or insufficient fuel sources, and circular debts in the electricity sector. Political divisions impede crucial projects like dam construction, economic challenges hinder funding for new energy policies, and the neglect of cleaner energy sources worsens the country’s energy crisis issues.

Globally and locally, the energy crisis poses significant challenges, affecting economies, increasing poverty, and risking a global recession. Urgent interventions are essential to establish sustainable and reliable energy supplies, and for energy conservation.

The Constant Load Shedding

In this essay, the grave energy crisis in Pakistan will be discussed and analysed with relevant examples and statistics. Several factors have convulsed Pakistan with power shortages, and the most important among them is arguably rooted in deficiencies of governance rather than pure supply.

This complicated crisis, which has long been running, is not only instigating hiccups for consumers but also threatening the country’s economy and its precarious security situation. Thus, the World Bank expressed the need for reforms to increase electricity reliability and ensure cost-effectiveness.

According to the report published in 2018, Pakistan’s power sector caused a total of  $18 billion  or 6.5% of the GDP loss to the economy, in 2015. Nonetheless, effective and timely reforms could have saved $8.4 billion in business losses and increased household incomes by at least $4.5 billion a year, the report added. 

Decisively, the Pakistan Economic Survey 2019–20 revealed that in the year 2020, Pakistan increased its installed electricity generation capacity up to  37,402 MW . However, only an estimated 73.91% of Pakistan’s population has access to  electricity , whereas around 50 million people still lack access to grid electricity, according to the World Bank 2019 report.

World Bank & Its Possible Solutions for the Current Energy Crisis in Pakistan

To overcome Pakistan’s energy crisis, the World Bank’s Board of Executive Directors in June 2021 approved a total of  $800 million  in funding for two projects in Pakistan, namely the Pakistan Program for Affordable and Clean Energy (PACE) and Securing Human Investments to Foster Transformation (SHIFT). To get the best possible solutions to the energy crisis , Pakistanis need to understand what renewable energy is , what the potential is, what the challenges are, and what the best way forward for implementation is for local and international projects.

Worth $400 million, PACE will help Pakistan’s transition to low-carbon energy and introduce powerful reforms in the energy sector including subsidies for consumers. In this regard, Rikard Liden, task team leader for the PACE program stated, “Decarbonizing the energy mix will reduce the dependence on  fossil fuel imports  and vulnerability to price fluctuations because of movement in exchange rates. PACE prioritizes action on such reforms, which must be sustained to address circular debt and set the power sector on a sustainable path.”

On the other hand, SHIFT, which is worth another $400 million, intends to improve health and educational services while bringing the federal and provincial authorities on board. Altogether, these two initiatives by Pakistan in collaboration with the World Bank aim to empower the power sector for energy development.

Accusations Against the World Bank

Nevertheless, a recent report released by Recourse, a European think tank, has stunned not only Pakistani officials but has also raised multiple questions in the minds of the general public. According to the European think tank, the  World Bank  is the major reason behind Pakistan’s decades-long energy sector crisis.

In its report titled “World Bank’s Development Policy Finance (DPF) 2015–21: Stuck in a carbon rut,” the European think tank disclosed that its studies conducted in Indonesia and Pakistan have found the World Bank endorsing the use of natural gas and backing fragile energy sectors that are heavily invested in coal, instead of promoting renewable energy sources.

Emphasizing the need to have proper checks and balances, the think tank referred to the PACE program (2021-2022) that aims to ensure Pakistan’s transition to low-carbon energy. It stated in its report that, as per the agreement with the World Bank, the funding was subject to the condition that Pakistan’s authority would accomplish a  66% percent  renewable energy target by 2030 by espousing a least-cost generation plan.

However, the targets for the energy sector have been slashed from 30-33 percent to nearly 17 percent , which will result in massive environmental degradation and resource exploitation. Outrageously, the year 2021 marks the second year of foundational reforms since Pakistan showed compliance to the World Bank’s  ‘Prior Actions’  under Development Policy Finance (DPF) amounting to $1.4 billion.

IGCEP Power Plan Under Scrutiny

While questioning the reliability of the plan, the European think tank has blamed the World Bank’s DPF operation for its destabilizing effect on the ability of Pakistan to achieve the transition to a sustainable renewable energy conduit. 

Not just this, another shocking news came as the think tank conversed about the pressure on the energy committee of Pakistan to approve the controversial Integrated Generation Capacity Enhancement Plan (IGCEP-2047) that the National Electric Power Regulatory Authority (NEPRA) vice-chairman refused to sign in the first place, keeping in view the reverberations it will yield later.

This political pressure to fast-track the IGCEP came back in August when  Hartwig Schafer , vice-president of the World Bank, made his way to Pakistan and urged the government to take necessary actions to implement power sector reforms. In this regard, the Institute of Energy Economics and Financial Analysis (IEEFA), together with the Alliance for Climate Justice and Clean Energy, undertook a recent study that revealed the flaws and potential consequences of the IGCEP plan. 

It stated in its report titled “Pakistan Risks Locking into Overcapacity and Expensive Power” that the “power demand growth forecasts made under the  Integrated Generation Capacity Enhancement Plan-2047  [IGCEP-2047] are too high and do not take into account the impact of COVID-19.”

The study finds GDP growth to increase from 4% to 5.5% by 2025, yet the plan could make Pakistan stuck in overcapacity in the long run and upend sustainability and affordability as experienced by states like China, India, Indonesia, and Bangladesh since they overestimated consumer demands.

Notwithstanding the fact that the  5.3GW coal-fired  power plants under IGCEP will be operationalized by 2030 and have a collective utilization of just 14%, they will make Pakistani coal plants stranded since functioning at such a low utilization rate is impossible. Thus, IGCEP’s patronage of expensive coal power plants for energy production over the much cheaper renewable energy resources indicates the failure of the plan to live up to the country’s affordability principle.

Prioritizing Action and Evaluation

In light of the fact that the World Bank’s “Priority Action” will make Pakistan suffer the most disparaging energy crisis in the long run, the essay recommends halting the enactment of the program as soon as possible. The energy demand, which is expected to quadruple in Pakistan in the coming years, will not only cause the consumer to undergo a grave energy crisis, worsening energy security, but will also bring massive pressure on the state to conciliate the demands of the people.

Therefore, this essay outlines important steps that have to be taken at the earliest to overcome the energy crisis in Pakistan. Pakistan must introduce power sector reforms that support a transition to renewable energy (solar energy, hydro power, etc.) and look for alternatives that would yield energy efficiency and protect the environment to a greater extent. 

The time has come when the government has to work on red-tapism, corruption, and other constraints that are hindering foreign investment in the energy sector and should focus on institutional reforms that are much more desirable than ever. The government also needs to focus on encouraging organizations such as ezBike that are introducing electric vehicles in the country.

In this regard, the China-Pakistan Economic Corridor (CPEC), a flagship project, can prove phenomenal for the energy sector, as China stated during a meeting in Islamabad that it has so far invested around $12.4 billion in Pakistan’s energy sector, and a total of 12 power generation projects having the capacity to generate 7,240 MW of energy are either completed or in the construction phase as per the 2019 report. 

Importantly, the installed electricity generation capacity was recorded at 34,282 Megawatts in Jul-Mar 2018-19 which is pretty encouraging for the energy sector. For that reason, CPEC is a golden opportunity for Pakistan to bring the country out of the energy crisis. To conclude this essay, Pakistan should take urgent action and ensure a fair investigation of the World Bank’s projects before the energy crisis becomes irreversible. 

If you want to submit your articles and/or research papers, please check the  Submissions  page.

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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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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Finding the Right Way Forward in Pakistan’s Energy Crisis

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Domestic renewables are the best hedge against global LNG price volatility and supply insecurity.

The ongoing global energy crisis has left countries scrambling for fuel. As wealthy buyers of liquefied natural gas (LNG) offer top dollar for every available cargo, Pakistan faces dire fuel and power shortages with little end in sight.

There will be no easy way forward. Reversing Pakistan’s dependence on imported fossil fuels by accelerating the shift to low-cost domestic renewable energy sources will be crucial for energy security and economic growth. In the meantime, Pakistan needs a coherent LNG procurement strategy that avoids locking in high prices for upcoming decades.

In the aftermath of Russia’s invasion of Ukraine, Europe is buying significantly more volumes of LNG to cut its dependence on Russian gas. But with almost no spare global LNG supply capacity, European buyers have pulled existing cargoes away from developing nations by offering higher prices.

Pakistan is suffering the consequences. In July, state-owned Pakistan LNG Limited (PLL) issued a tender to buy 10 cargoes of LNG through September but did not receive a single bid.

This is the fourth straight tender that went unawarded. In a previous tender, PLL received only one bid from Qatar Energy at a price of $39.80 per million British thermal unit (MMBtu). At this price, a single cargo would cost over $131 million. Pakistan’s government rejected the offer to conserve its dwindling foreign exchange reserves.

The effects have been disastrous. Power cuts are crippling household and commercial activities, while gas rationing to the textile sector has resulted in a loss of $1 billion in export orders . Despite energy conservation efforts, many areas continue to experience load shedding of up to 14 hours , as the generation shortfall reached 8 gigawatts (GW).

Some countries are shielded from extreme LNG price spikes by long-term purchase contracts. But Pakistan sources roughly half of its LNG from spot markets, increasing the country’s exposure to global price volatility.

To mitigate the situation, Pakistan has expressed openness to signing new long-term contracts, with one official claiming the country would go for an unusually long 30-year contract. The contracts will most likely be signed with Qatar and United Arab Emirates.

However, Pakistan’s experience with long-term contracts has been problematic. Term suppliers had defaulted at least 12 times over the past 11 months, most recently in July when Pakistan desperately needed fuel.

Long-term contracts – which are typically tied to a “slope” or a percentage of the Brent crude oil price – are reportedly 75 percent more expensive than a year ago. If Pakistan signed a deal now with a 16-18 percent slope, and assuming current Brent crude prices of $100, a single cargo would cost roughly $55-61 million. At the 11-13 percent slope of Pakistan’s current contracts, meanwhile, a cargo would cost $37.5-44.3 million. Although Brent crude prices will vary, it is clear that Pakistan would risk locking in higher prices by signing new long-term contracts in the current LNG environment.

Moreover, with limited global LNG supply, long-term contracts would likely not start until 2026, when significant new global supply capacity is expected online. Pakistan’s LNG needs are more immediate.

Rather than lock in high prices for the long term, buyers in Pakistan can consider signing shorter five-year contracts with portfolio players. Industry representatives have suggested there is space in the market for shorter contracts. Although shorter terms typically come at a price premium, they may temporarily help alleviate Pakistan’s exposure to extreme spot market volatility.

Short-term contracts have to carry higher penalties in instances of non-delivery to avoid repeated supplier defaults. Coupled with the existing long-term contracts and spot purchases, short-term contracts would diversify the country’s supply portfolio, potentially allowing better price management, supply security, and flexibility.

In the longer term, cutting Pakistan’s dependence on imported fossil fuels altogether is the most affordable solution. Low-cost, domestic renewables like wind and solar can prove to be a crucial hedging mechanism against high, U.S. dollar-denominated fossil fuel prices.

The government is beginning to recognize the unreliability and unaffordability of LNG compared to domestic renewables. Policymakers recently indicated that they would announce a new solar policy geared toward reducing LNG dependence, reducing high energy costs, and improving energy security.

Under the policy, due out August 1, 7-10 GW of residential solar systems would be deployed by the summer of 2023. In addition, the policy would allow the installation of seven utility-scale solar plants at the sites of existing thermal power plants.

This is a major step in the right direction, one that will help reduce gas and LNG demand in the power sector. We also identified other measures in a recent IEEFA report to limit LNG demand, such as reforming gas distribution company revenue regulations to reduce gas leakage, along with energy efficiency incentives.

Ultimately, there will be no one-size-fits-all solution to the current energy crisis, but a portfolio of short to long-term plans is necessary to mitigate Pakistan’s unsustainable reliance on LNG imports.

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Energy crisis in pakistan & its causes, created by editorial board, energy crisis in pakistan :.

Energy crisis has become the most critical issue all over the world. But energy crisis in Pakistan has affected our lives very badly. In cities, we have 12 to 18 hours load shedding, while in villages the situation is even the worst. Furthermore, in winter, we have storage of ‘Sui’ gas too. Energy is just like a blood in the body of modern economy. Let us discuss the causes, effects and possible solution of this situation.

Causes of Energy Crisis :

During the last three decades, we had not built new dams and water reservoirs. We did rely on thermal units. These units are run by oil and gas. The oil prices are soaring higher and higher and no stability is seen in near future. On the other hand, gas reserves are getting short in supply. So, supply is decreasing whereas the demand is increasing, because of growing population. All these things have worsened the situation.

Energy Crisis Effects :

Shortages of energy and load shedding have cast negative effects on our lives. Especially, our economy has been hit hard. Our export orders are not fulfilled in time. Many of the factories and industrial units have been closed. Thus millions of workers have been unemployed. People in home have become the victims of many psychological diseases. During demonstration on roads against the government and power companies, some of them damage public property.

To come out of this horrible situation, we will have to take steps on two levels, Short term and long term. In short term, we should adopt such policies as could run our economy on priority basis. We should also try to save energy. The government should make new agreements with Iran and central Asian republics for cheap energy.

In the long run, we must shift our reliance on hydro projects from thermal projects. The coal reserves of “Thar” can also be used for cheap electricity. If we do not realize the seriousness of this crisis, it can further worsen the situation. So, remedial measures on war-footings must be taken to cope with this giant problems.

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The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions

• Fahad Farooq
• December 15, 2023
• CSS Essays , CSS Solved Essays

CSS & PMS Solved Essays | The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions

Fahad Farooq , a Sir Syed Kazim Ali student, has attempted the CSS & PMS essay “The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions” 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 crisis in Pakistan: A critical overview

3 – What are the causes of the energy crisis in Pakistan?

• Evidence: Pakistan’s economic conditions constrain the construction of power generation plants.
• Evidence:   Lack of policy formulation and implementation due to the unstable political environment
• Evidence: Inadequate transmission and distribution system and overloaded transformers, Report of special committee, Senate of Pakistan 2018
• Case in Point: According to a report published by NEPRA 2018, Pakistan’s energy sector currently has about 25% transmission and distribution losses.
• ✓ Corruption and power theft  
• Case in Point: Pakistan is ranked 117th among 180 countries in the Corruption Perception Index, 2018 by Transparency International.
• Evidence: Kalabagh Dam has not been completed due to inter-provincial conflicts.
• Case in Point: Water disputes in Pakistan with India and Afghanistan affect Pakistan’s power sector.
• Case in Point: In 2010, a severe flood severely damaged Pakistan’s power sector.
• Evidence: Reliance on thermal power plants instead of hydel power plants has significantly increased its average cost.

3- What are the impacts of the energy crisis in Pakistan?

• Evidence: Pakistan is suffering from 5 to 12 hours of load shedding per day, which affects the daily routines of students and employees.
• Evidence: Due to high reliance on thermal fuel, circular debt and subsidies provided to the energy sector have increased.
• Evidence: The energy crisis has made the lives of common people miserable. 
• Evidence: The unemployment ratio is increasing daily, which is giving birth to other social crimes.
• Evidence: The industrial sector has to cut down its production due to prolonged load shedding and rising electricity bills.
• Evidence: Due to the extreme energy crisis, foreign direct investment in the industrial sector has decreased.
• Evidence: Pakistan has been suffering severe deforestation due to high reliance on thermal sources for power generation
• Evidence: The energy crisis has caused extreme angst among the public, resulting in severe demonstrations against the government.

4- What are the pragmatic measures to overcome the energy crisis in Pakistan?

• ✓ To improve governance and effective implementation of policies
• ✓ To improve the efficiency of power plants and gradation of transmission infrastructure
• ✓ To formulate strict laws to control power theft
• ✓ To utilize renewable sources of energy for power generation instead of fossil fuels
• ✓ To generate electric power from nuclear power plants
• ✓ To build new dams for water storage and settle down inter-provincial conflicts

5- Critical Analysis 6- Conclusion

The energy sector of a country is the foundation of its socio-economic development. Thus, energy security has remained, and still is, the agenda of many developed country’s schemes. However, in developing countries like Pakistan, the energy crisis due to a shortage of energy   is the talk of every day. Pakistan has faced operational, managerial, and technical issues in the energy sector for the last two decades. The country has to overcome the crisis to attain socio-economic development in all sectors of society. Bad governance and inadequate planning by incompetent political leaders are the major causes behind the crisis. In addition, electricity losses in transmission lines and consumer power theft significantly burden the country’s economy. This energy shortfall has affected the country’s industrial, agricultural, and economic sectors. As a result, the unemployment, poverty, and social crimes in the society have increased. However, there is nothing in the world that cannot be solved. Pakistan should formulate strict laws and thoroughly implement them to control power theft. Updating the transmission and distribution structure to reduce power losses is essential. Moreover, the government needs to create awareness among the public to use energy-efficient products. In a nutshell, Pakistan’s socio-economic stability is impossible without addressing the issues responsible for the country’s energy crisis. This essay discusses the causes and impacts of Pakistan’s energy crisis and the pragmatic measures to curb the issue.

Currently, Pakistan is suffering from an acute energy crisis. Approximately twenty per cent of the country’s population needs access to electricity. But it does not produce enough energy to meet the demand. There is an electricity shortfall of approximately 8000 megawatts per day; as a result, the population has been facing the haunting effects of load shedding for five to twelve hours per day. This situation reflects the incapability of the previous governments to curb the issue and a need for more implementation of formulated policies in the power sector.

Since every issue has a cause, Pakistan’s poor economic condition is the primary cause of its energy crisis. Huge investments are required to lay the foundation of power projects to attain energy security in the country. Unfortunately, Pakistan has been suffering the worst economic crisis since its inception, due to which the power sector has been neglected.  In addition, Pakistan has been facing political instability for decades. According to the Global Economy Watchdog for Political Stability, Pakistan is ranked 192 among 195 countries . In such unstable circumstances, no solid and visionary policy has been formulated to enhance the country’s power generation capacity. As a result, the country’s power sector is facing an acute crisis.

Moreover, most of the projects being used for electricity production are outdated. Due to poor maintenance, these plants operate at an efficiency level much lower than the designed capacity. They consume more fuel and produce less energy; as a result, they tend to increase the circular debt, creating a burden on the federal budget through subsidies. These soaring subsidies have adversely affected the financial health of the economy. 

Furthermore, the high loss of electricity in the transmission and distribution system is a significant burden on the country’s energy resources.  According to a report published by NEPRA 2018, Pakistan currently has about 25% T&D losses.  

Apart from wasting energy, these losses go without payment to the power generation companies, which the government compensates through subsidies. So, these T&D losses significantly drain the country’s economy.

Additionally, corruption in the energy sector and consumer power theft are other significant contributors to the country’s energy crisis. A lack of technology-assisted techniques for stopping power theft has further devastated the situation.  Transparency International has ranked Pakistan 117th among 180 countries in the Corruption Perception Index, 2018.  Over time, several corruption scandals have been exposed in the power sector, severely affecting its growth and resulting in a high loss to national expenses. In this way, corruption and power theft significantly escalate the country’s energy crisis.

Similarly, inter-provincial conflicts on water sharing in Pakistan have hampered the development of Pakistan’s power sector. Small provinces blame the large ones for not giving their share in water resources. This mistrust has destroyed the understanding among the provinces to cope with the energy crisis. Due to these conflicts, the development of new power stations like the Kalabagh dam could not be possible. Furthermore, Pakistan has also indulged in a water war with its neighbours, India and Afghanistan. Now, India has started building dams on western rivers, and Afghanistan has begun building dams on the Kabul River, which has caused a water shortage for power generation in Pakistan. This has severely affected Pakistan’s power sector.

Another cause of the energy crisis in Pakistan is climate change. Due the phenomenon, heavy rainfalls are becoming very common, which cause floods. These floods damage the country’s electrical power sector every year. For example, the severe flood of 2010 severely damaged Pakistan’s power sector. Due to the lack of dams, this excess water from floods cannot be stored for valuable purposes. Thus, extreme weather patterns due to climate change also contribute to Pakistan’s energy sector disaster.

Lastly, shifting from hydel power plants to thermal power plants has proved another massive drain on the country’s power resources. More reliance on furnace oil to run power plants has made the country more vulnerable to the fluctuation of international oil prices. The current Russia-Ukraine conflict has exposed the vulnerability of various nations, including Pakistan, to oil and gas to meet their energy requirements. In this way, the soaring oil prices in the international markets are badly affecting Pakistan’s energy.

As every crisis comes with some aftereffects, load shedding is considered its most significant effect. This has affected all sectors of society. Due to this, students cannot fully concentrate on their studies, and public and private sector employees need more time in their work. Due to the non-availability of uninterrupted electricity, factories have shifted to other resources like furnace oil and natural gas, resulting in increased production costs. As a result, thousands of employees across the country have been expelled from their jobs. In this way, continuous load shedding has increased the poverty in society.

Due to the lack of solid and versatile policies of the incumbent political leadership, the dependence of power generation on thermal sources instead of hydel energy has increased. This high reliance on thermal fuel has resulted in increased circular debt. The outdated and deteriorated infrastructure of power plants, accompanied by high transmission and distribution losses, has created a massive gap between the supply and demand of electricity. Power plants are consuming more fuel and producing less energy. Moreover, insufficient recovery of bills from consumers has created a massive gap in the costs of generation and payment of recoveries. Instead of increasing the power prices, the government has increased the subsidies provided to the power generation companies. Thus, the energy crisis has significantly burdened the federal budget through subsidies.

The power crisis has made life hell for the majority of the citizens. Frequent load shedding has contributed to the increased unemployment in society. This unpredictable load shedding has caused extreme angst and distress among the public; as a result, various social evils like robbery and street crimes have increased in society. The condition of the youth of the country is especially miserable. 

Similarly, the energy crisis has severely affected the industrial and agricultural sectors. They have to cut down their production and lay off thousands of workforce. Factories face early shutdowns, and the employees wait hours to resume work. Consequently, the net output of the industrial sector has decreased. This has resulted in increased prices of fertilizers, pesticides, and other ingredients in the agricultural industry. Moreover, being a water-scarce country, Pakistan’s agricultural sector is highly dependent on the power sector to use underground water for agriculture. Due to frequent shutdowns of electricity and high furnace oil prices, farmers face massive agrarian losses.

Due to the energy crisis, Pakistan is less likely to attract foreign direct investments in industrial sectors. There is a continuous decline in the existing number of industries in Pakistan. Maximum industries have been shifted to foreign countries, where cheap and reliable energy supply is available. Thus, the energy crisis in Pakistan has raised the cost of production.

Pakistan is highly dependent on thermal power plants and has been facing severe deforestation. Due to an unfortunate controversy among the provinces, Pakistan lacks hydel power projects. Besides this, the massive dependency on fossil fuels for electricity production has led to several environmental hazards, such as the emission of GHGs, global warming, and irregular weather patterns. Global warming has been the cause of severe floods in Pakistan for the last two decades, which has badly affected the domestic lives of ordinary people.

The long and often unpredictable hours of load shedding have caused extreme angst among the public, resulting in severe demonstrations against the government. Unfortunately, Pakistan is ranked 192 among 195 countries by the Global economy watchdog for political stability. Due to this political instability, there has yet to be continuance in the formulated policies to overcome the energy crisis in the country.

Every issue has a solution. First, the government should formulate solid laws and thoroughly implement them nationwide. There should be no political involvement in the power sector. The government should mainstream the issue of the energy crisis in the national narrative and try to develop a national consensus on this issue.

Furthermore, the government should focus on increasing the installed power generation capacity. Research centres should be established for prime solutions to power sector problems. The efficiency of the transmission and distribution system should be increased on a priority basis. The government should encourage the distributed generation to reduce transmission and distribution losses.

In addition, technology-assisted techniques must be used to stop power theft. The power sector cannot remain sustainable unless the service cost is fully recovered. The provincial governments and law enforcement agencies should assist the federal government in controlling power theft and the excessive losses in the transmission and distribution system.

Additionally, the country needs to shift from fossil fuels to renewable energy resources for electricity production like wind, hydel, and solar power projects to reduce environmental pollution and resolve the current energy crisis. Pakistan is enriched in hydro-power resources with the potential of 50000 megawatts, which is still untapped. The government should speed up the construction of hydel projects like the Diamer Bhasha Dam and other big projects like Dasu. The country should adopt renewable resources like wind and solar power as soon as possible to shift the trend from fossil fuel generation towards renewable generation.

Moreover, Pakistan should immediately enhance its nuclear power generation as it is cheap and reliable. Pakistan is 6th atomic power in the world but generates only a tiny amount of electrical power from nuclear sources. This will decrease the country’s dependency on foreign technology and imported fuels.

Lastly, being a water-scarce country, Pakistan needs to build more dams to store excess water in the monsoon season and use it in the dry season to run the power plants. For this purpose, the government should immediately settle the inter-provincial conflicts on major power projects, like the Kala Bagh Dam, to include bulk power generation into the national grid and avoid floods. Pakistan should negotiate with India and Afghanistan on critical water disputes as Pakistan’s power sector is highly dependent on the water received from these countries.

The energy sector of Pakistan has been facing an acute crisis for the last two decades due to incumbent political leadership, lack of formulation of solid policies and other technical issues. The situation has hampered Pakistan’s socio-economic development. With a dwindling economy and soaring political instability, the country needs immediate pragmatic steps to curb the issue for the smooth running of all the state’s sectors. If this issue is not resolved on a priority basis, the situation will become worse. In conclusion, the prolonged energy crisis has devastated the national economy. It has slowed down the industrial sector and affected all life sectors. It has caused inflation, unemployment, and poverty in the society. It has also damaged Pakistan’s international image. Multiple reasons behind the crisis, like poor governance, outdated power plants, transmission and distribution losses, power theft, inter-provincial conflicts on water resources and high dependency on thermal sources, need an immediate response from the government. And the adoption of renewable technologies can tackle the issue of outdated plants, reducing power losses, and implementing effective policies.

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Forthcoming energy crisis in Pakistan

The shortage of gas and fuel deliveries to Europe will ultimately put pressure on Middle Eastern sellers

The Russia-Ukraine war disrupted gas supply to Europe and there is a likelihood of a further reduction in supply. Therefore, the European Commission proposed plans to cut gas demand by 15% until next spring. To achieve this target, consumers’ demands in public administrations, households, buildings, power suppliers, and industries will be capped.

I wonder if Pakistani policymakers also formulate such plans before a crisis land in their garden or do they keep waiting till panic triggers? The forthcoming winter can be disastrous for Pakistan as the country does not have long-term energy management plans. The shortage of gas and fuel deliveries to Europe will ultimately put pressure on Middle Eastern sellers who are our main source of imports. Our policymakers do not realise the crisis we are about to face. Early steps help spread out the efforts over time, ease market concerns and price volatility, and allow for a better design of targeted, cost-effective measures protecting the industry. Research has revealed that Pakistan has a maximum gas supply of 4,300 million standard cubic feet per day (mmcfd) against the average demand of 6,500 to 7,000 mmcfd. During the winter season, the demand rises to 8,000 mmcfd. Therefore, there can be a shortfall of 3,500 mmcfd.

Pakistan is already faced with multidimensional issues because of a lack of storage facilities, no planning, depleting foreign exchange reserves, and the absence of broad-based alternative energy sources. In Europe, traditional energy sources are coal, oil, nuclear and renewable sources but Pakistan is short of everything and has over 220 million consumers. Europe is working on an important pillar of energy saving: the reduction of heating and cooling while the Pakistan Market Share Report indicates that there is over 7.2% growth in usage in the domestic market.

Without a “demand reduction plan”, we will be faced with critical energy shortages. Unfortunately, our state institutions are more interested in playing “election ludo” and political parties are busy in political kabaddi. Instead of locking cheaper gas deals, the former PTI government was more focused on political victimisation, blame game, and ethics degradation. The incumbent coalition government is also faced with uncertainty and is more concerned about staying in power and re-election. The tense political and economic situation has become a cause of concern for all citizens. However, those in positions of power have ignored the gravity of these issues.

As always, our policymakers adopt a reactive approach, which prevents them from resolving the ongoing issues. Our state motto appears to be “it will be dealt with when it will be visible”, which needs to change. Our policymakers must adopt a proactive approach because states cannot be run on a day-to-day basis.

There is no plan for either international challenges or domestic ones. The forthcoming energy crisis is one of the many issues that need articulation. Other issues that we do not have any plans for include population growth, unemployment, food shortages, inflation, unending political circus, stable foreign policy, public diplomacy, or restoring our global image.

Unfortunately, both print and electronic media have failed to initiate any productive discussion. Mainstream television channels have not paid any attention to important affairs, our public remains unaware of all other issues besides domestic political tussle. Real problems and real solutions are not a priority, and the result is in front of us.

If we do not provide our audience with the world view, they will keep bickering with each other on political affiliations while the root of the problem will remain intact. Energy, food, and security will remain in the shadows until they become a ghost and stand right in front of us to receive due attention.

Published in The Express Tribune, August 9 th , 2022.

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