PML-N primarily focused on LNG & coal instead of cheaper fuel: Irsa official
WASIM IQBAL
ISLAMABAD: Pakistan Muslim League-N government primarily focused on imported liquefied natural gas (LNG) and coal for power generation instead of cheaper fuel including hydel power generation which accounts for the rise in the price of electricity.
Former Prime Minister Shahid Khaqan Abbasi, who was earlier Minister of Petroleum, was the main supporter of using imported LNG in power generation instead of relying on more expensive fuels like high-speed diesel and furnace oil.
An official of Irsa told Business Recorder that there is massive capacity for storage of water on the Indus River but to utilize the potential reservoirs must be constructed on the river. Hydel generation is an inexpensive solution to addressing the energy crisis in the country therefore it should be harnessed instead of going for the more costly solution.
He said that almost 29 million acre feet (MAF) water in Pakistan flows into the sea. Pakistan must target allowing 8 to 10 MAF water to flow into the sea while the rest is stored in reservoirs, he added.
According to Central Power Purchasing Agency (CPPA-G), surge in the fuel cost is due to a massive drop in hydel power production in May 2018 compared to the same month last year and increased reliance on expensive sources of power production including imported LNG.
The hydel power production dropped 11.87 percentage points to 18.30 percent (2,217.61 Gigawatt hour or GWh) in the total production in May 2018 compared to 30.17 percent (3,326 GWh) in May 2017.
This untoward situation compelled the authorities to raise reliance on power production from RLNG-fired plants. Accordingly, the production from this relatively expensive source surged 16.07 percentage points to 23.85 percent (2,890.17 GWh) in the energy mix in May 2018 compared to 7.78 percent (857.31 GWh) in the same month last year.
The cost of power production from RLNG-based plants increased to Rs9.10 per unit in the month from Rs7.11 in the same month last year due to upward trend in the fuel price in the international market.
Former Managing Director Pakistan Electric Power Company (PEPCO) Tahir Basharat Cheema stated that the main reason for a decline in power sector sustainability was the PML-N government’s flawed decision to support costlier power generation during the past five years.
“Addition of expensive electricity of 10,000 MW in the system led to increase in basket price by Rs 3 per unit: if the basket price was Rs 6 per unit previously the addition of 10,000 MW has increased the basket price to Rs 9 per unit,” he contended.
RLNG, he said, costs Rs 9.50 per unit and as result the price of electricity has gone out of the reach of the common man.
During 2018, when overall power production is expected to go up to 33,124 megawatts, the share of hydroelectric power will be 30 percent, furnace oil 18 percent, LNG 16 percent, local natural gas 12 percent, imported coal 10 percent, renewable energy 8 percent, nuclear power 4 percent and local coal 2 percent.
In 2022, however, hydroelectric power will likely have a share of 36 percent, followed by furnace oil at 12 percent, LNG 10 percent, nuclear energy 9 percent, renewable energy 9 percent, locally produced natural gas 8 percent, local coal 8 percent and imported coal 8 percent.
The draft document of National Water Policy (NWP) released by PML-N government envisaged the party’s intent to double water storage capacity to at least 28 MAF from existing 14 MAF thereby increasing the storage capacity from 10 to 20 percent of total water flows.
The policy also noted an investment of Rs 2.891 trillion in water sector for the following: Rs1.6 trillion to build Diamer-Bhasha and Mohmand Munda Dam, Rs800 billion for water conservation, Rs150 billion for drainage, Rs12 billion for flood control, Rs300 billion for rehabilitation of barrages, head works and canals and Rs29 billion for research purposes.
