Textile exporters decry decision to cut gas supply to power plants

FAISALABAD: The Pakistan Textile Exporters Association (PTEA) has strongly criticised the government’s decision to discontinue gas supply to highly efficient Captive Power Plants (CPPs) starting January 1, 2025.

In a joint statement on Friday, PTEA Patron-in-Chief Khurram Mukhtar and Chairman Sohail Pasha warned that this move threatens the stability and growth of Pakistan’s textile industry, which heavily relies on the CPPs to maintain consistent power flow and operational efficiency.

The PTEA officials highlighted that billions have been invested in gas-based CPPs, with 480 such plants on the SNGPL network and 800 on the SSGC network. These CPPs are crucial for providing stable and uninterrupted power, which is essential to avoid costly voltage drops and fluctuations in highly automated textile machinery.

The officials cautioned that relying solely on the national grid, which suffers from transmission and distribution losses, would not meet the industry’s demand and could damage sensitive equipment across the textile value chain.

In-house power generation via CPPs allows simultaneous production of power and steam, integral to the industrial process. The CPPs are considered more efficient than government-owned plants, and concerns have been raised that grid-supplied power, coupled with frequent outages, would be insufficient for industrial use. Additionally, large-scale manufacturing units with power demands exceeding 10 MW per hour would face significant costs and time delays in setting up their own grids, further straining production capabilities.

The PTEA warned that this decision could worsen Pakistan’s gas sector’s financial situation, where circular debt has already reached Rs2,700 billion. The textile sector, one of the largest consumers of imported RLNG after the power sector, currently provides cross-subsidies of more than Rs100 billion to other sectors.