Energy Crisis In Pakistan And Its Solution

Like most other energy deficient countries, Pakistan is also bound to feel the pinch of rising energy prices. While world economy continues to remain wobbly and while its relationship with United States undergo a changing geopolitical scenario, it must find identify the underlying problems creating the energy problem and also find ways to deal with them quickly.
Energy Crisis in Pakistan and its Solution
Source - Wikimedia Commons (https://commons.wikimedia.org/wiki/File%3AThe_Minar-e-Pakistan.jpg)

Impact of Rising Fuel Demand

Pakistan is also one of those developing countries, who have got some relief by the recent fall in crude prices. However, for a country that uses oil for almost 40% of its primary energy needs, the fact that crude prices are rising again is enough to remind it of the energy crisis that continues to haunt it.

With increasing demand from emerging economies, especially China in recent times, prices of all energy sources have seen a steep rise during the last two decades. Most affected has been oil and natural gas, which after the seventies, again reached

threatening proportions in the beginning of this decade before the Shale gas revolution brought them down considerably. Pakistan's energy crisis is thus more of an oil and gas crisis rather than a real energy crisis. This is so because Pakistan has enormous coal reserves, worth about $ 30 trillion, and yet, the share of coal in its energy mix is less than 6%. The energy sector in Pakistan depends primarily upon oil (43%), followed by natural gas (38%) and hydroelectric-nuclear power (10%).

The Extent of the Problem

As per ‘Dawn’, one of the primary dailies in Pakistan, the country faces a shortfall of about 4000 MW in the power sector, which rises up to 7000 MW, approximately 32% of total demand of electricity. The shortfall in natural gas is roughly two billion cubic feet per day (BCFD). Over 140 million Pakistani citizens either have no access to power or suffer more than twelve hour load shedding, even while the demand for electricity keeps rising by almost 10% every year. As per rough estimates, more than 50,000 workers have lost their jobs due to closure of business resulting from power shortages. The losses arising from inefficient transmission and distribution has risen to nearly Rs. 150 Billion.

Another indicator of the inadequate power supply is the fact that roughly 60% of Pakistani household have some form of UPS as a backup. The approximate annual expenditure on these devices is about Rs. 30 Billion, showing the extent to which, misallocation of resources have resulted in to inefficient state of affairs. About 67% of domestic energy is consumed in Pakistan by relatively less efficient appliances, indicating the scope of improvement.

As of today, a large number of households in

the country are not connected to the National Power Grid. This however is changing very fast, and as that happens, the per capita as well as overall demand of energy in the country will skyrocket very soon. Rising income levels are bound to bring with them a steep rise in household power consumption. Even before that happens, there is a reasonable possibility that the oil prices will rise, worsening the energy crisis that the country cannot avoid.

The problem with underutilization of coal arises from its under exploration, which is partly because of poor technology use, partly because of inadequate investment in the sector, and partly a result of poor planning and inadequate private entrepreneurship. Another issue is the distance. While most coal reserves are located in the West, most of the demand exists in the Eastern Pakistan.

The Potential Solutions

There are many solutions available for Pakistan to take care of this situation, but none of them are easy, and each of them requires conviction, commitment and perseverance. The first and the foremost option is to increase the share of coal in the energy-mix being used by the country. China uses coal to serve around 70% of its needs. India uses it for 60% of its energy needs. There is no reason why the same cannot happen in Pakistan. In fact even a share of 30 to 35% taken up by coal during the next ten years will serve as a major boost for the oil-gas dependent energy sector of Pakistan.

Another solution can be the use of more efficient appliances and greater use of renewable energy like wind and solar, the prices of which are falling every day, making them affordable, particularly for households and communities not directly connected with the primary grid. Another solution could be alternative sources of energy, like biomass, which is the main fuel for rural households, and if properly utilized, can serve to solve a large proportion of its needs.

The other solutions include laying pipelines from oil exporting countries. The Iran-Pakistan-India gas pipeline can serve many problems for both countries. Unfortunately the political situation since the Mumbai attacks has not conducive for acceleration of the project.



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