Friday September 29, 2023

Import limits on furnace oil threaten summer electricity supply

June 07, 2023

ISLAMABAD: Electricity consumers would face 3-5 hours of load-shedding during peak summer as the government has decided to curtail furnace oil imports for power generation due to the dollar crisis, an official of the Energy Ministry said. “The country is currently facing a shortfall of about 4,000MW, which is why consumers are facing power outages for 2-3 hours across the country,” the official said.

Additionally, the NEC that met with Prime Minister Shehbaz Sharif in chair, has decided to close the commercial markets at 8pm to save electricity. However, the implementation of the decision would be an uphill task for the provincial governments, who would likely face a resistance from traders.Pakistan’s total generation capacity stands at 44,000MW against a demand of 21,500MW. Electricity consumers, who have paid almost Rs900 billion in the shape of capacity charges will pay about Rs1,400 billion in 2023-24. “This means in the tariff for the next financial year, the share of the capacity payments would also increase, meaning that that capacity payment would cause more increase in the tariff,” the official added.

On top of this, line and recovery losses are also on the higher side. Therefore, higher generation also translates to higher losses. The official said that due to certain constraints, hydropower was not being utilized at full capacity. The total hydrogenation capacity stands at 9,400MW but the current average generation stands at close to 4,000MW.Hydrogenation from the main dams of Tarbela and Mangla depends upon the water releases, which fluctuate on the demand of the provinces for irrigation purposes. The official said that because of the ongoing construction work of Tarbela dam for the 4th and 5th extension power projects, about 1,410MW was not coming into the system.

Neelum-Jehlum Hydropower Project is also non-operational, which has resulted in a shortfall of 969MW in the system. Also, other power units of the Tarbela dam are generating low electricity because of the construction issues and fluctuations in the water releases as per demands from provinces. “The powerhouses are currently running over 13 percent to 64 percent of their capacity mainly because of the Rs2.5 trillion circular debt. The government owes the China-Pakistan Economic Corridor power project $1 billion,” the official said. “Also, the Independent Power Projects, which have installed capacity of over 17,000MW are currently generating only 7,700MW, this means that they are running at 45 percent of their total capacity again because of the liquidity crunch,” the official added.