The ADB said that with continued
demand growth, it will be ncreasingly difficult for Pakistan to meet its demand with domestic sources. DESIGN: TALHA AHMED KHAN
For achieving even a low growth rate of 3.4% over the next two decades, securing foreign energy supplies will be critical for Pakistan amid a volatile security situation in Afghanistan, as the country’s domestic supplies gradually dry up, according to an Asian Development Bank (ADB) study.
In its Energy Outlook for Asia and Pacific report, the Manila-based lending agency has urged Pakistani authorities to double its efforts for addressing energy sector bottlenecks that have hit economic growth, resulting in increasing unemployment in the country.
The ADB released its findings the day when Prime Minister Nawaz Sharif described his strategy on energy as “energy emergency”. The premier approved on Monday immediate start of work on two coal-fired power plants at Gadani and Port Qasim.
The ADB said Pakistan is faced with domestic supply shortages of coal, oil, and natural gas, as well as shortage of hydroelectric generation capacities. These fuel constraints have severely affected the power sector, leading to a significant decline in power production.
“At its peak, the gap between electricity demand and supply was as high as 40%,” according to the ADB report. Until 2035, Pakistan’s annual economic growth would be rather moderate at 3.4% unless infrastructure development is sufficient to facilitate economic activity, it added.
It said in the same period, energy demand is projected to grow 2.2% annually. However, if the country applies some energy saving methodologies it could restrict the growth to 1.8% per annum. Natural gas will still meet the largest share, reaching 43.8% by 2035, followed by oil at about a fourth.
The ADB said that with continued demand growth, it will be increasingly difficult for Pakistan to meet its demand with domestic sources. The country is not only facing domestic energy supply constraints but also problems of outdated and obsolete supply infrastructure.
It said securing energy supply sources of natural gas, oil, hydro and coal will be critical for economic growth. It projected that domestic production of natural gas will decline from the current 38.4 billion cubic metres (bcm) to 13 bcm in 2035 and the country will have to start importing natural gas sometime after 2015.
Pakistan is already working on the Iran-Pakistan gas pipeline project, which is facing delays due to US sanctions against Iran and inability of Pakistani authorities to arrange funds for construction of its side of the pipeline.
Petroleum and Natural Resources Minister Shahid Khaqan Abbasi recently stated that Islamabad had requested Tehran to provide finances for constructing the pipeline.
The country is also pursuing the Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline aimed at importing 90 million cubic metres of natural gas. Inter State Gas Systems signed gas sales and purchase agreements with Turkmenistan in May 2012.
However, the ADB struck a note of caution saying some care needs to be taken so that the TAPI pipeline does not collide with the planned trans-boundary pipeline from Iran to Pakistan. It warned that political situation in Afghanistan may also affect progress on the TAPI project.
The lending agency reiterated that the country’s power sector was badly affected by circular debt, as its Central Power Purchasing Agency often remains short of funds to meet its obligations towards power suppliers.
It added the issue of technical and non-technical (theft) transmission and distribution losses also remained a major obstacle.
Analysts have also questioned the PML-N government’s strategy to address the power sector’s problems by only increasing electricity tariffs. They have called for a three-tier strategy comprising reducing theft, improving recovery and gradual increase in power tariffs.
Published in The Express Tribune, October 15th, 2013.
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COMMENTS (5)
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I agree that govt needs to tackle the power shortage issue at multiple levels, out of which zero tolerance towards line loss/ theft. Setting up of solar parks is welcome but set up costs are high. As domestic electricity usage forms a large chunk of the consumption, solar powered home packages can be introduced with bank financing for upper and middle class urban and rural residents. The programme with production and uploading reverse metering facilities. That means limited setup as the cost of storage can be saved in absence of storage component of the solar panel system as the power generated by solar panels is released in national grid, whereas the producer/ home user can take normal energy from national grid in three phase and smart meter can do smart billing paying for the initial costs and saving to consumer and overcoming national grid shortages! It's doable proven in many countries.
@drti: Well, you did,
And why should he appeal to the lowest common denominator. Let him write in a comprehensive manner.
But shale is tough as you need water, high capex (much higher than conventional drilling), an army of technocrats (pressure physicists , geologists , etc). It requires hydraulics and horizontal drilling - only US is capanle at the moment.
@Munir Mian: Talking about lack of knowledge did you know that people find it extremely hard to read large blocks of text off a computer screen? That is why we break up text into small paragraphs and use bullet points and headlines. In other words writing for the web is very different from what your English teacher taught you in school.
Oh yes and no one is going to read the great wall of text you've erected there. No one.
@Munir Mian: Where is the water needed for shale gas extraction.......
When will the government realize that shortage of electricity in the country is not the result of shortage of natural resources. There is an abundance of resources which can be harnessed easily. What is lacking is technical knowhow. Here are some of the resources that most countries are harnessing: (1) wind turbines. Germany has installed more than 2400 wind turbines, some generate as much as 1MGW. Wind turbine has few parts; a gear box, a generator, a 2 or 3 blade propeller mounted on a pole or a metal structure. (2) Solar panel farm. China has the largest solar panel structures. Solar panels are cheep to manufacture and easy to install. Spain has developed a sophisticated plant having 6000 steel mirror reflectors which power a boiler to produce superheated steam to operate steam a turbine and a generator. (3) Pakistan has the potential to harness water ways and build hydroelectric dams and power plants. (4) Pakistan does not have to import gas from Iran to burn and produce superheated steam to operate steam turbines and generators. As the last earthquake in the west showed there are large gas fields in the region. Pakistanis need engineers to dig and harness gas available in the region. (5) Pakistan has shale oil, as demonstrated by the earthquake. Shale oil is extracted by a process known as "fracking". There are other natural resources present in the country. Pakistanis have to develop them all by themselves. Pakistan needs engineers to exploit shale oil present under its own soil. Do not blame Americans for threatening to impose sanctions. More than 67 years have passed since Pakistan came into being. Still Pakistanis have a shortage of techicians and engineers!