The prevalent decade-long energy crisis is a consequence of many factors, above all weak policy and decision-making. A crucial factor in this respect has been a lack of comprehensive and integrated approach at the ministerial level. Since 1970s, the energy sector has been devolved mainly into two ministries. The power sector is the responsibility of the Ministry of Water and Power (which has now been named Ministry of Energy, Power Division), while the oil and gas sector is looked after by the Ministry of Petroleum and Natural Resources. This devolution has undermined the country’s ability to develop a vibrant and cohesive energy strategy. The result has been segmented and imbalanced policies and initiatives.
The newly-elected PTI government has assigned a minister for petroleum suggesting that it would be business as usual; while the power sector is tipped to be run by a separate minister. It is a surprising decision and departure from the PTI’s earlier stance that is also expressed in its energy policy of 2012 that argued for a ‘single, professional energy ministry’. It even proposed the merger of Nepra and Ogra to form ‘a single, efficient regulator’!
In the global landscape of numerous governance models and norms, the trend of unified energy ministry is quite obvious. Developed and efficient countries like Germany, France and the UK have their vibrant, diverse and prolific energy sectors run by a single office. Similarly, the US energy sector with annual power consumption almost 50 times greater than that of Pakistan is overseen by a single office, the Department of Energy. Not only that, in many cases the energy ministry comes in conjunction with other portfolios like environment, climate change and industry. For example, in the UK it is the ‘Department for Business, Energy and Industrial Strategy’, in France it is the ‘Ministry of the Environment, Energy and Marine Affairs’ and in Australia it is the ‘Ministry of Environment and Energy’.
Pakistan’s energy sector made the best progress in the 1960s and 70s when cabinet size remained between 11 and 17. The post-1988 era saw a massive growth in the number of ministries and size of cabinets for obvious political reasons. Interestingly, the present energy crisis appeared in 2006 when the cabinet size was 78. A reality check suggests that the devolution of the energy sector has not contributed to its uplifting and improvement; instead things have been complicated and diluted. Except for capacity addition (ill-planned and at exuberant price), there is hardly any matrix to suggest that it has been a beneficial experience. There has been lack of critical inter-stakeholder coordination, increased bureaucratic hurdles, and segmented policy and decision-making. The consequences for the energy sector to mention a few are: expensive power generation, imbalanced energy mix, reduced share of indigenous supplies, weaker financial health of the energy sector and frailer T&D systems.
Coming towards the way forward, when it comes to capacity addition and bridging the gap between demand and supply in the power sector there are five distinctive technology streams at Pakistan’s disposal: hydropower, thermal (oil, gas and coal), modern renewables like solar energy and wind power, energy conservation and management and nuclear power. Over the last three decades, the focus has been mainly on thermal projects despite the comparatively much superior position of hydropower. Consequently, since 1990 the share of thermal power in installed generation capacity has increased from under 50% to over 65% and that of hydropower has declined from over 50% to almost 25%. Renewable energy has never been in the good books of decision-makers, and the body concerned Alternate Energy Development Board (AEDB) in its early years did not help the cause either. Solar and wind power have seen a collective capacity addition of around 1,000MW, which is a tiny fraction of what these technologies have experienced in other countries. Energy conservation and management — one of the main cornerstones of energy strategies across the world — could not be cared less about. The focal body, National Energy Efficiency & Conservation Authority (NEECA), formerly known as National Energy Conservation Centre (ENERCON), since its inception in 1980s has lacked not only in identity, resources and mandate but also delivery. This unappreciative approach towards all energy streams other than thermal power is an indication of imbalanced policy and decision-making.
It is also noteworthy that across the world these different energy technologies have a kind of rivalry, just like AC/DC currents have had in the 19th century, at all level, from research and development (R&D) to policy and decision-making. Pakistan has witnessed this in the form of excessive ground gained by thermal power, thanks to the powerful oil and gas lobbies and cartels. In the greater national interest it is important that all energy streams and technologies are handled on merit by a single impartial body.
To recover from the current crisis and move towards a sustainable energy future, Pakistan thus needs to give all its five energy streams — hydropower, thermal power, renewables, energy conservation and nuclear power — a level-playing field. All ideas, proposals and projects from these technologies should have an inter-comparison before a go ahead. This can be done when there is a unified decision-making. Ideally, ministries of water and power and petroleum and natural resources should be merged. However, if this is not possible for whatever the reason, an energy council sitting above them as the final decision-making authority could be an option though it would bring along another layer of bureaucracy.
Published in The Express Tribune, September 5th, 2018.