Money Matters

Back to dark ages

Money Matters
By Engr. Hussain Ahmad Siddiqui
Mon, 06, 22

Pakistan continues to face a serious electricity crisis for the last three weeks or so, as load shedding has intensified across the country. The power deficit in the National Transmission & Despatch Company (NTDC) network is currently recorded at over 7,000MW, and the power supply-demand gap is likely to widen in the coming days due to fast-growing demand for electricity on account of hot weather conditions, and delays in supply of fuels.

Back to dark ages

Pakistan continues to face a serious electricity crisis for the last three weeks or so, as load shedding has intensified across the country. The power deficit in the National Transmission & Despatch Company (NTDC) network is currently recorded at over 7,000MW, and the power supply-demand gap is likely to widen in the coming days due to fast-growing demand for electricity on account of hot weather conditions, and delays in supply of fuels.

The masses — already over-burdened with highly inflated electricity bills — must brace with 8 to 10-hour load-shedding daily in major cities, including Islamabad, Lahore, and Faisalabad, while small towns, rural areas and feeders in major cities categorised as high-loss recovery areas face up to 14-hour-long blackouts. Karachi is also bracing prolonged power outages, up to nine hours in a day as currently the K-Electric system has a deficit of over 600MW. On June 5, K-Electric has cautioned of extended load shedding, likely for another five hours, if fuel supplies are not arranged.

The large-scale load-shedding in the national system has crippled civic life as well as industrial, trade and commercial activities. The industrial sector is subjected to record 10-hour outages, while industrial captive power plants are deprived of natural gas, with a multiplier effect on the national economy. There have been protest demonstrations last month in Rawalpindi, Peshawar and a few other cities, demanding cut in the prevalent massive load shedding that remains unscheduled. The political unrest is another important dimension of the prevailing power crisis.

The existing installed power generation capacity from all resources is 34,501MW (NTDC system), of which the net or dependable capacity is estimated to be about 30,000MW — much more than demand during peak hours these days. While the government no more shares the statistics of daily power generation and demand with the public on a regular basis, present generation, recorded on June 6, is 20,621MW, which is disproportionate to installed capacity.

The suppressed demand is said to be 28,066MW. Electricity shortfall thus was 7,445MW on that day. Major contributors to electricity generation are thermal power plants (12,120MW), hydropower (5,348MW), and nuclear power (1,749MW). Renewable energy resources contribute 1,107MW wind-power, 178MW biogas, and 119MW solar to cumulative power generation.

Interestingly, NTDC system had evacuated record 24,566MW electricity during 2021. In spite of addition of significant power generation capacity in the last few months — particularly that of hydropower and nuclear energy resources — total generation, instead of improving, has steeply declined, with existing capacity being grossly under-utilised. First unit of 180MW capacity of 720MW Karot hydropower station was connected to national grid in mid-May. Earlier, the second unit of Karachi Nuclear power plant (KANUPP-III) of 1,100MW commenced commercial operations.

The power situation has worsened primarily due to inadequate transmission capacity, flawed strategy, imprudent use of available resources, and transmission and distribution losses. The power sector circular debt has now swelled to Rs2.46 trillion and Independent Power Producers (IPPs) are facing difficulties in servicing their dues and, therefore, have cut down generation drastically, despite huge reliable existing capacity. The government has recently released Rs50 billion to the Chinese IPPs, which is the first instalment of their total dues of Rs340 billion.

Due to financial constraints, Pakistan State Oil (PSO) is unable to provide adequate oil supplies to powerhouses, and same is the situation with gas supplies. Power plants are not getting liquefied natural gas (LNG), furnace oil or imported coal as per their requirements. Practically, total reliance is on hydropower generation capacity of 9,873MW but the water reservoirs are not yet full, like in Tarbela, due to lesser rains this season though the flow in rivers has increased recently.

Obviously, the government has failed to address energy crisis effectively. It has paid no serious attention to the mismanagement, inefficiencies, and a host of other institutional issues of the power sector. Most importantly, laxity on the part of the government has resulted in increased technical and collection losses, or electricity theft. The DISCOs have been unable to improve their recoveries from the private sector that have swelled to some Rs500 billion. Energy conservation measures, such as restricted timing for commercial activities in the evening, were either not implemented or did not yield positive results in the past. Now the government is reconsidering to curtail business hours in markets in the evening in major cities.

In short, there is no respite seen to massive electricity load shedding in the foreseeable future. Federal Energy Minister Khurram Dastgir Khan has said on May 8 that “the present government is determined to provide an interrupted power supply to the masses”, but he says on June 5 that end to load shedding was not possible. Obviously, the biggest challenge for the government is to control ever-increasing power sector circular debt, which cannot be managed in short span of time given the present financial crisis.

Sadly, adequate electricity at affordable price remains a distant dream for the country’s consumers, in the wake of record increases in oil and gas prices, resultantly higher power tariff, and anticipated withdrawal from July 1 of the available subsidy of Rs5 per unit to consumers using 700 units.


The writer is retired chairman of the State Engineering Corporation