The official said that electricity and gas shortages are considered to be the primary causes of constrained production activities in a number of industries and added that energy intensive industries such as petroleum, iron and steel, engineering and electrical industries shaved off 0.2% from real GDP growth in 2010-11 and in 2011-12. Providing an analysis of the impact of energy shortfall, he said that the liquidity crunch in the power sector has resulted in under utilisation of the installed capacity of up to 4,000 megawatts which affected investment in the power sector.
He said that the floods caused electricity and gas shortages as it damaged the distribution network ie 90% of distribution transformers to the petroleum and gas fields. Lower accumulation of water reserves in dams along with high international prices of oil has compounded the pressure on electricity as there is still significant share of oil in electricity generation, about 35.1%, which is vulnerable to the international prices. Furthermore, the oil refineries have also been running below capacity, thus constraining the supply of oil and other fuels, the official added.
In order to solve the issues in the power sector, the government has decided to construct five multi-purpose water storages in the country during the next 10 -12 years. The Diamer-Bhasha project - the world’s highest roller compacted concrete dam - is the most mentionable achievement.
Published in The Express Tribune, June 27th, 2012.
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Without focusing on Thar Coal or Kalabagh dam, we will not be able to provide a sustainable stream of affordable electricity to our masses. All other sources are temporary or have a higher cost component in the long run,
For the short run we will need to eliminate subsidy from the power distribution system to enable the govt to put money in real development rather than continue to borrow from the banks and dwarf out private credit. However this seems like a wishful thinking given that the election are on the horizon and a govt of inepts and corrupts in place.