Power generation declines, costs increase in Q1FY25

KARACHI: The country recorded low power generation at a high cost in the first quarter of the current financial year, with output falling by over 8.0 per cent and costs rising by 3.2 per cent, according to a report by Arif Habib Limited.

Per power generation data, output declined by 8.1 per cent year-on-year to 40,546GWh in July-September of this fiscal year, compared to 44,137GWh during the same period last financial year.

In September 2024, power generation stood at 12,487GWh, posting a decline of over 6% year-on-year compared to 13,339GWh in the same month of the previous year. On a monthly basis, power generation registered a fall of 5.3%, down from 13,179 GWh in August of the current financial year.

During September 2024, actual power generation was 10 per cent lower than the reference generation.In the first quarter, hydel power generation fell by 6.0 per cent, while generation from RLNG declined by 8.6 per cent. The power generation from furnace oil plummeted by 87 per cent, and wind power generation decreased by 29 per cent during this period.

The cost of power generation rose to Rs8.29 per kWh, compared to Rs8.03 per kWh in the same quarter of the last fiscal year. In September 2024, the cost of generating electricity increased significantly by 12.4 per cent, reaching Rs8.34 per kWh, up from Rs7.42 per kWh in the same period last year. This increase is attributed to the rise in power generation costs from imported coal, which climbed to Rs25.96 per kWh -- a gain of over 9.0 per cent -- compared to Rs23.8 per kWh during the same period last fiscal year.

Fuel costs have risen due to lower production from hydel and nuclear sources, both of which are relatively cheaper, and higher generation from costly imported coal, which increased by over 78 per cent year-on-year.In the first quarter, hydel was the leading source of power generation, accounting for 39.3 per cent of the total, followed by RLNG-based electricity with a 17.5 per cent share.

In September of this fiscal year, hydel emerged as the leading source of power generation, accounting for 38.7 per cent of the generation mix, followed by RLNG at 16.3 per cent. Nuclear power accounted for 12.8 per cent of the generation share. Among renewables, wind, solar, and bagasse generation contributed 3.2 per cent, 0.8 per cent, and 0.3 per cent, respectively, to the overall electricity generation in the country.