5 steps to solving Pakistan's energy crisis
Are political parties finally taking the energy crisis seriously? If so, I have a few suggestions...
Out of all the problems we face as a country, energy seems to be the one that annoys us the most. It’s not that other issues are not important or are somehow less annoying; it is just that every single person in Pakistan uses energy in one form or another and hence is directly affected by it at a very personal level. So when a few days back I was invited as an expert delegate to the PML-N’s energy conference , I was pleasantly surprised that our political parties are beginning to showing signs of maturity and started talking issues.
The conference itself was an unusually serious affair where actual experts sat through a gruelling six hour discussion session on the draft PML-N energy plan. It was for the first time I saw an actual alternative workable policy being presented and discussed by a political party with stakeholders such as academia, power producers and energy experts. All in all, it was a great platform and serious discussion took place that can potentially lead to a solid energy strategy. I later found out that PTI also held an energy conference of its own and presented their draft plan as well.
Even though I would have personally preferred the perspective economic plans to be put forward first, but a start on an issue like energy strategy seems to be pretty good too. This is a national issue and we need all the alternative policies we can get to finally craft a solid national policy and in that regard, political parties putting forward their workable strategies is something the people have longed for.
And in that spirit, I would like to present a few ideas that can help with our energy crisis.
1. Replacing thermal power fuel
Pakistan produces about 81 percent of its electricity through oil and gas which costs us about 9.4 billion dollars. To put it in other terms, that is about 53 percent of our total exports and is the biggest cost on our import bill. Now given that our reliance on thermal power is so large, we simply cannot dismantle it and magically move to hydro power, however we can change the fuel used to gain thermal power. Instead of using oil and gas, both of which are getting more expensive and have volatile international prices, we can move to using coal.
But not the Thar coal, I will explain why later, but imported coal. If we were to import clean coal and use that as a fuel instead of oil and gas, it would cost us less as the price of coal is more stable than that of oil and gas in the international market. This can bring some sort of price stability in our electricity prices that keep changing due to changes in international market prices
2. Moving past the myth of Thar coal
Yes, there is coal in Thar, but assuming that it can be used immediately or it will solve all our energy problems is a myth propagated by a few people and political parties for their personal gains. Experts agree that Thar coal is highly unstable - making it difficult to transport it from one location to another - and even its gasification is not risk-free.
On location gasification also requires heavy investment, which has practical difficulties due to the unstable nature of the coal deposits. So instead of wasting time and effort on this, we should focus on importing coal to replace the ever increasing oil and gas bill.
3. Improved energy mix
Energy mix refers to the sources of energy we utilize in Pakistan to fulfil our overall energy needs. I need to give credit to the PML-N on this one as they are the first ones to talk of the holistic energy mix and not just the CNG or the electricity crisis.
The fact is that all our energy is interdependent.I have previously advocated that we need to move off CNG as we simply do not have enough of it to supply to all the commercial, industrial and home users. Its about time that any future energy strategy Pakistan is supposed to have comes with a proper energy mix to solve our issues.
We need more hydel plants and renewable energy projects. In the next five years, the aim should be at getting five percent of our total power supply from renewable sources and to also use the nuclear power we are so proud of, to provide electricity. Right now, we are at about three percent power generation from nuclear sources, which have to go up to at least percent. Hence an overall improved energy mix is what can solve our issues in the long run.
4. Stand alone power projects
This is a suggestion that I gave at the conference and I am advocating it now again. About 40 percent of Pakistan is off the national grid; that means they effectively get to no electricity.
The way our grid operates, it is already suffering from heavy line losses and other technical issues, which makes it extremely hard and costly to get 40 percent of the Pakistan on to the national grid. However there are solutions to this.
We can finance independent stand alone power projects that can function in areas where there is no national grid, this way the local communities and businessmen can set up their own energy solutions without taking prior permission from the National Electric Power Regulatory Authority (NEPRA) like they have to now. This will enable them to set up small scale solar panels and plants in their communities and sell electricity locally. Small wind farms can also be used in areas which are close to wind corridors.
The bottom line is, let the people who are living in areas that don't come under the national grid, do whatever they can to supply themselves with electricity without any government involvement.
5. Dismantle the national grid
The national grid needs to be dismantled and provincialised, because under the 18th amendment, the profits of power generation go to the province that is producing the power, meaning if electricity is being produced at Tarbela, royalties of that are being paid to KP Government by all other provinces. However, they sell it to the national grid and then the national grid sells it down to the District Electrical Supply Companies who further sell the power to the consumers. This way, if there is a shortfall, national grid chooses the electricity supply patterns and hence decides which areas suffer outages the most.
If we dismantle the national grid and change the electricity supply to an open market, where provincial grids can buy energy directly from the source, it would improve the power supply and be more financially beneficial for the power producing province. This way, the provinces with the most issues with electricity supply can simply outbid the others to get enough for their local demand. This would not be privatization but 'provincialization', and will encourage provincial governments to start doing more for their people instead of relying on the federal government.
This can eventually lead to provinces working harder to upgrade their grids and reduce their line losses as their people would know exactly who to blame if the power goes out. I think it is time we started thinking on these lines given that the 18th amendment has already been passed and provincial autonomy is our future.
I hope our political parties come with their own alternative strategies while taking these points in to account too. Energy crises is a national issue and all possible solutions should be explored to solve it.
Read more by Adnan here.