Pakistan’s Energy Crisis
Image Credit: U.S. Embassy Pakistan

Pakistan’s Energy Crisis

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Pakistan is in the midst of one of the worst energy crises in its history. This is both slowing the pace of economic activity and causing public unrest with prolonged outages of electricity and gas. Capacity utilization in some key industries has fallen to nearly 50 percent. Worst affected is the fertilizer industry, which faces interruptions to its gas supply and forced closures. Pakistan has the capacity to produce more than one million tons in exportable surplus urea, yet in 2011-12 it imported more than 1.1 million tons. This eroded the country’s foreign exchange reserves and effectively entailed the payment of millions of dollars in subsidies, being the difference between the cost of locally produced and imported urea. Pakistan urgently needs to make some strategic decisions and change the national energy mix.

Immediately after assuming power, the government of Nawaz Sharif came up with two policy decisions: pay half a trillion rupees (just under $5 billion) to energy companies and announce a new power policy. Both steps are aimed at resolving problems plaguing the companies belonging to the energy chain and bringing change to Pakistan’s energy mix to optimize the average cost of electricity generation.

Pakistan’s government paid Rs260 billion in cash to independent power plants (IPPs) to clear outstanding debt. It also issued bonds to pay off liabilities pertaining to state-owned companies such as exploration and production firms and oil and gas marketing entities. After clearing the debt of the IPPs, it was expected that they would be able to generate 1,700MW in additional electricity, attenuating the shortfall that currently exceeds 6,000MW. The situation is likely to improve over time.

According to the available data, at present installed power generation capacity in Pakistan is estimated to about 22,500MW (excluding the Karachi Energy Supply Company, more on which below), but actual power generation hovers around 15,000MW, partly because of outdated and inefficient power plants and partly because of a cash crunch, which often does not permit power plants to operate at optimum capacity because of the inability to buy the required furnace oil. This could be best understood when one looks at the available data on power plants operating in the public sector, which have an installed capacity of over 4,800MW but actual generation hovering around 1,200MW.

At present, the bulk of electricity supply comes from hydroelectric plants (6,500MW) and IPPs (6,500MW). The output of the hydro plants is dependent on water availability in the dams, and can fall to as low as 2,500MW when water levels drop drastically. And as we have seen, IPP output is limited by money problems.

Pakistan’s woes have been exacerbated by its excessive reliance on thermal power plants, mainly using furnace oil. Two factors contributed to the emergence of this situation: a change in lenders from the public to private sector, and Pakistan’s failure to complete a hydroelectric project in recent decades. The last mega dam, Tarbella, was completed in the mid seventies and no other dam has been constructed since. After the signing of the Indus Water Treaty with India, Pakistan was required to complete construction of one mega-size hydroelectricity plant per decade to ensure year-round availability of low cost electricity and irrigation water.

Of Pakistan’s 6,500MW hydro capacity, the bulk is contributed by three projects: Mangla, Tarbella and Ghazi Brotha. There are nearly two dozen IPPs, but the major players are Hub Power Company, Kot Addu Power Company and Uch Power Plant. Pakistan also has three nuclear power plants, two in Punjab and one in Karachian, with aggregate capacity of over 800MW. However, the Karachi plant is at the end of its effective life and its capacity cannot be termed “dependable.”

Unlike the rest of Pakistan, Karachi gets its electricity from a compact utility, Karachi Electric Supply Company (KESC), which handles generation, transmission and distribution. The bulk of its generation comes from the Bin Qasim Power Plant, which has an installed capacity of 1,260MW. Another 500MW comes from smaller units. Since privatization, KESC has added another 500WM capacity at Bin Qasim but its output has remained erratic because of the inconsistent supply of gas.

Comments
10
sarang
February 10, 2014 at 21:39

currently pakistan is suffering a great shortfall of energy but we pray in the coming future pakistan will be one of the eneergy supplier countries….
INSHALLAH

Syed Minhaj Uddin
November 28, 2013 at 14:43

I love you Pakistan, INSHA ALLAH we will be the top country in world , we are the only islamic country with Atomic Power ALHUMDULILLAH, the true re-presenters of Islam still exist here, all these games what other country agencies playing in Pakistan will end-up, we have the biggest Textile zone , talent and every thing ALHUMDULILLAH , still Indian people are more poor than Pakistan so keep focus there rather to Akhand Bharat or something else! we have the pride to be among the one of two countries which are came into being on Ideology and that is No God But ALLAH !!!

Pakistani
September 5, 2013 at 06:32

Great article! Really well written.  Thank you and write again!

The comments are just hilarious.  I wonder what they’re eating in India. 

Girish
September 3, 2013 at 12:20

Pakistan has broken world record in bomb blasts, its like a blast per day. Also they have created a record in Islamic history as well where Muslims are butchering fellow muslims all in the name of their religion and greatness of god.

Pakistan is a cancer and its society is a curce on humanity. It was a good decision that Pakistan was seperated from India

* Due to seperation, it is proved Muslims are not terrorist, only currupt and radical muslims are (like in Pakistan). Indian Muslims are the most peaceful, patriotic and forward looking muslim community in this world.

* If Pakistan was part of India, dynamics of today would have been different. India would have been fighting with Taliban on its borders and these terrorism would have created Indian Taliban (like they have done Pakistan Taliban).

Akhanda Bharat
September 2, 2013 at 20:27

There is only one solution to Pakistan's problem….Merger with India….Before merger, ask for forgiveness from India, Afghans, Bangladeshis, religious minorities of Pakistan with folded hands, accept whatever wrong they have committed, promise to the world that they will become the most law abiding peaceful citizens of this world and will give up the ideology that 1 Pakistani Muslim=10 Indian Hindus….Then India will accept Pakistan and former Pakistani citizens will not face any shortage of anything and the dream of "Akhanda Bharat" or "United States of India" will be fulfilled.

A Moderate Indian
September 2, 2013 at 14:52

Let your comment be relevant to the topic! Nobody is interested in what happened in the past, all our troubles we are facing npw, in India and Pakistan, are our creations only!

Human
September 2, 2013 at 14:08

If you have anything againt one country, no problem, but never say bad words againts Religion. It may be any Religion. 

Girish
September 2, 2013 at 13:56

@

you hardly found any other way to show your frustration.

Well, if India is having any hand in support of Baluchistan freedom, then it is good. After all it can be a point of bargain to stop Pakistan spreading terrorsim in India. Pakistan  is a rough state with no clearily who is running it. So talk doesnt work with Pakistan. India must increase the cost of runnign terrorsim business for Pakistan against India.

Well, Hinduism is older then your imagination can go. Infact if you just go and check your DNA, you will find that your ancenters where Hindus (I hope you dont live in a dream just like other Pakistanis that you are Arabs, or turks or someone else?).

Also, Hinduisms is very dynamic religion and have inbuilt systems to evolve with time and rectifiy deficencies. If you are talking about Caste systems, then  you must understand that eradicaiton of caste systems has already evolved and is disappearing fast (ofcouse it cannot in in months).

"I would not prefer to say bad about Islam as my IQ is better then yours and I know how to respect other religions. This is because of my belief only"

Godman? well Godmen have exists in very society and will always exists. Point is in Hinduism or (India) there are enough people who can bring them down and this happens regularly. Recent godman is behind bar now who abused the girl (I hope you read clearly).

"Entire world know about Mulla controls muslims. Each roits starts from prayers from Mosques when a mulla ignite the fire in illitrates." We have seen it with first hand.

Rapes? This is a shameful things which happens everywhere. You simply cannot put on Indian society specially if you count crime rate verses population ratio.

"Pakistan is unique model here, they simple rapes to settle familty disputes, kidnap minorites gilrs and convert into Islam. I am not saying all this, it is Pakistan media which says this. Rapes and kidnapping is an industry in Pakistan"

 

 

Krishnalund
September 1, 2013 at 23:13

Spreading terror into Baluchistan is Indias role in the region. Hinduism teaches people to spit and look down upon someone based on caste system. India is poorer than Africa and hungrier than Ethiopia they dont need food aid they need Kama sutra books in their Mundirs. Hindu men are known world over as the rape kings they teach young boys this in their University at a young age. 

 

The ashrams of the Hindooos provide explicit lessons on how best to rape foreign tourists also Krishnas blessings and lingams 

Girish
August 31, 2013 at 21:22

Spreading terrorist to India and to the world is what Pakistan’s priority. Oh yes they also have priority to kill each other for islam.
They don’t need electricity. Pakistan needs rdx and intact a formal university of terrorism. Today they provide bachelor degree in informal schools of terror camps and madarsa…

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