Energy mix shows signs of improvement

LAHORE: Pakistan has improved a balance in its energy mix during the last three years with furnace-based power generation accounting for 29.61 percent, gas-combusted (27.32 percent) and hydropower (35.40 percent.

Energy mix determines an economic growth and the shares in the world trade. How power is produced and used will remain a critical factor in the future of the global economy, geopolitics, and the environment. 

The government took a right step of banning new power generation from furnace oil, which accounts for one to five percent of total electricity generation in the many developed economies. 

The installed hydroelectricity production capacity in Pakistan is 7,115 megawatts. The hydropower lowers in winter with as low as 2,135MW, but during summer, it goes up to 7,262MW. 

The country’s installed nuclear power capacity is 955MW, but actual production is 860MW. The capacity of gas-run power generators is 53,235MW, while the actual production is 4,260MW. The combined capacity of solar/wind power is 1,497MW but the daily availability is 374 MW.  

Furnace oil-run generators produce 6,239MW as against the installed capacity of 7,799 MW. The installed capacity of coal-based power plants is 31MW, while the actual production is 25MW.

With the commissioning of Neelam Jhelum and Tarbela, the hydroelectric power generation in Pakistan will reach 9,641MW by 2018. Nuclear power will increase to 1,148MW by 2018 and to 2,130MW by 2021. Power generation from gas will increase to 5,540MW by 2018 and 7,164MW by 2019. Coal power generation will rise to 1,081MW in 2018 and 3,712MW by 2020. Furnace oil-based power generation will remain static at 6,239MW. Solar and wind energy will also remain static.  

Global energy demand is estimated to grow 0.7 percent a year till 2050, while the energy need in developing countries, like Pakistan, is expected to grow 10 to 15 percent, depending on GDP growth rate. 

Globally, the energy demand slack is more due to digitisation, greater efficiency and shift towards services that require less energy. 

A large portion of population in the thickly populated developing world would gradually be connected with power grids. As far as transport is concerned, the fuel efficient automobiles are reducing the demand for oil. Automakers expect that cars will be using 40 percent less fuel in the next two decades than what they consume currently.

It is estimated the share of electricity in total global energy consumption will increase to 25 percent by 2050 from the current 18 percent.

McKinsey, in a research report, said more than three-quarters of new capacity (77 percent) will come from wind and solar, 13 percent from natural gas, and the rest from everything else. The share of nuclear and hydropower is also expected to grow, albeit modestly. This means that non-hydro renewable energy will account for more than a third of the global power generation. In 2014, it was below six percent. Wind and solar power are expected to grow four to five times faster than every other energy sources.

Fossil fuels will dominate energy use till 2050. This is because of the massive investments that have already been made and because of the superior energy intensity and reliability of fossil fuels. The mix, however, will change. 

Likewise, gas will continue to grow quickly, but the global demand for coal will likely peak around 2025. Growth in oil consumption, which is predominantly used for transport, will slow down as vehicles get more efficient. Peak demand could come as soon as 2030. 

The research said coal will be down to just 16 percent of global power generation by 2050 from 41 percent now and fossil fuels to 38 percent from the current 66 percent. Coal, oil, and, gas will continue to be 74 percent of the primary energy demand by that time, down from 82 percent now. After 2050, the rate of decline is likely to be reversed.