Short supply of fuel triggers power crisis

Two times short supply of fuel to the thermal units of Pepco has triggered power crisis in the country. Reliable sources said non-availability of furnace oil due to lack of funds is hampering all efforts to overcome widening demand-supply gap. Presently, said a Pepco source, a total of 11000 tons furnace oil is available for thermal generation daily, as against a requirement of 33000 ton per day.
"The short supply of fuel is due to non-availability of sufficient funds," added the source. It is worth mentioning that per ton price of furnace oil has touched to Rs 62000 in the market. Sources also confided to the Business Recorder that present visit of Minister of State for Foreign Affairs Hina Rabbani Khar to Saudi Arabia was also for the purpose of negotiating oil supply on deferred payment basis.
Meanwhile, on Tuesday, the demand and supply gap reduced to 4,500MW against unprecedented 6000MW a day earlier. It was mainly due to increase in indent from the Indus River System Authority (Irsa) and improvement in oil supplies to the thermal generation. Further, increase in temperature has also given hope for early snow melting at hilltops, likely to improve hydel generation as well.
Pakistan's energy sector is in crisis, especially since November 2007 onwards. Its energy security is becoming a grave challenge for policymakers with every passing day. It is for the first time during summer that the shortage has peaked to 6000MW, leading to forced closures for up to 20 hours in rural and 14 hours in urban areas, respectively. The third annual report 2010 of the Institute of Public Policy suggests that the cost of power outages to the industrial sector in 2009 was Rs 230 billion or about 11 percent of industrial value added. The total cost of industrial load shedding to the economy is estimated at Rs 325 billion or 2.5 percent of the GDP.
Similarly, the loss of employment in the economy is estimated at 535,000 jobs and the loss of exports was $1.3 billion in 2009. According to the power sector experts, the deficit between supply and demand of energy is growing wider and if no action is taken to enhance domestic supplies, it could have serious consequences for the economy. They said a significant part of Pakistan's population is not served by the energy sector and 30 percent of the population does not have access to electricity alone.