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June 11, 2019

Power generation capacity increased by 2.5pc

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June 11, 2019

ISLAMABAD: Pakistan’s electricity generation capacity during July-March 2018/19 increased by 2.5 percent to 34,282MWs, the Pakistan Economic Survey 2018/19 that the government launched on Monday, said.

It is worth mentioning that in Nawaz Sharif’s five-year tenure, power generation capacity had increased by around one-third to 29,573MWs till February 2018 against 22,812MWs in 2013. Although, electricity generation varies due to availability of inputs and other constraints, the generation increased from 82,011GWh to 84,680GWh, posting a growth of 2.1 percent during the period under discussion.

The survey says that the share of hydro in electricity generation has decreased overthe last few decades. Availability of water is also one of the main reasons for reduced generation from hydel power plants.

Currently, thermal has the largest share in electricity generation. Gas and RLNG are other cheaper sources. RLNG’s tremendous growth in energy mix has helped meet the demand to various power plants (Bhikki, Haveli Bahadurshah, Balloki, Halmore, Orient, Rousch, KAPCO, Saif and Sapphire) while the remaining was supplied to fertiliser plants, industrial and transport sector.

As an alternative, the government showed commitment for electricity generation capacity through renewable energy sources. During July-March FY2019, there was an increase of 1 percent in share of renewable in electricity generation, and it is expected that the share will increase in coming years as well.

Oil-based power generation plants, which remained the face of the power sector of Pakistan for over three decades, have been planned to be phased out over the next few years and it is expected that the share of furnace oil-based energy will decline to single digit percentage in the overall energy mix in the coming years.

On the other hand, Pakistan has large indigenous coal reserves estimated at over 186 billion tons, which are sufficient to meet the energy requirements of the country on long-term basis. Apart from indigenous coal resources, there has been significant increase in import of coal as well due to commissioning of new power plants based on imported coal at Sahiwal and Port Qasim. However, domestic production of coal is expected to increase in the coming years with projects on Thar coal.

The survey says that during the period under review, five wind power projects of 246.6 MW were completed and started supplying electricity to the national grid. Two bagasse cogeneration projects of 58MW were also completed.

The survey says that there is no significant change in the consumption pattern of electricity. However, during July-March 2018/19, the share of household and agriculture in electricity consumption has been decreasing which is indicating that people are trying to rationalise the usage due to increase in its tariff. The increase in the share of industry in electricity consumption is a positive sign showing revival of industry which was suffering earlier due to loadshedding.

Pakistan mainly depends upon oil and gas resources to fulfill energy requirements. The domestic production of crude oil remained 24.6 million barrels during July-March FY2019 compared to 21.8 million barrels during the corresponding period last year, depicting increase of 12.84 percent. Indigenous resources of oil are not enough to quench energy thirst of a growing economy. As a result, Pakistan has to import large quantity of oil as well as oil based products from Middle Eastern countries, especially from Saudi Arabia. During July-March FY2019, the quantity of crude oil imported remained 6.6 million tonnes with value of $3.4 billion compared to the quantity 7.8 million tonnes with value $2.9 billion during the same period last year. The decline was mainly due to increase in international prices. The deferred payment on imported oil from Saudi Arabia will give an ease to the government on balance of payments.

Transport and power are the two major users of oil. During July-March FY2019, share of oil consumption in transport increased to 77 from 56 percent during the same period last year, while share of oil consumption in power decreased to 14 percent which was 25 percent during the same period last year. Mainly, gas being the cheaper source, there is continuous shift of power sector from oil to gas.

Natural gas is a clean, safe, efficient and environment friendly fuel. Its indigenous supplies contribute about 38pc in total primary energy supply mix of the country.

The Survey says that it is expected that gas will be supplied to approximately 430,695 new consumers during the fiscal year 2019-20. Gas utility companies have planned to invest Rs 7.161 billion on Transmission Projects, Rs 48.288 billion on Distribution Projects and Rs18.556 million on other projects bringing the total investment around Rs74 billion during the fiscal year 2019-20.

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