Growing energy crunch

President Musharraf's directive to the Ministry of Water and Power to expedite completion of small-scale power projects to help meet the rising energy demand in industrial and agricultural sectors is reflective of how serious the energy crunch has become.
Chairing a meeting on the status of short-term energy projects in Pakistan, he has underlined the need for facilitating private sector entrepreneurs, both local and foreign, in setting up small power plants on priority basis. He has also directed the ministry high-ups to execute these projects within the stipulated timeframe. He said energy would also be imported from regional countries, and that alternative sources of energy, including coal, residual fuel oil, and wind mills would be utilized to ensure supply of more energy on a sustainable basis.
According to a Recorder Report, Minister for Water and Power Liaquat Ali Jatoi later said at a press briefing that it was for the first time that private sector investors had been invited to make investment in hydel power projects in Pakistan. However, the quantum of investment secured so far does not match the government's expectations. According to one estimate, Pakistan will require an investment of $20.4 billion by 2010-2013 for the planned mega projects and for the existing system's improvement.
The country's current aggregate power production stands at 19,404 megawatts, while we will require another 5,529 megawatts by the year 2010 to meet our energy needs which are growing by six to seven percent per annum. As we have earlier argued in this space, harnessing the alternative sources of energy ie coal, wind, solar, etc despite the relatively higher initial installation cost, is the second best option after hydro power.
Pakistan has unfortunately had to place excessive reliance on the prohibitively expensive thermal option for meeting its energy deficit. For instance, we imported over 80 percent of our crude oil requirements in 2005, thereby burdening the national exchequer with an oil import bill of $3 billion, which amounts to nearly one-fifth of the country's total export earnings. Obviously, we cannot afford for long the reliance on the thermal option, and will have to explore and develop alternative sources of energy.
Solar parks and windmills are practical options for Pakistan that need to be seriously explored. For instance, there is plenty of sunshine throughout the year in Balochistan, while the massive wind corridor discovered at Gharo-Keti Bandar in Sindh last year could be utilised to tap this abundant source of renewable energy. In addition to Balochistan, solar parks can be established in the coastal regions of Sindh, which are blessed with almost round-the-year sunshine.
In fact, the Alternative Energy Development Board (AEDB) has already issued LoIs to 41 national and international companies for generation of 700 megawatts of electricity by 2010 as a part of the government's broader strategy to meet at least five percent of the country's total energy requirements through alternative sources. However, the initial quantum of investment required for an alternative energy project is quite substantial: an amount of $80 million is needed for installing a single wind power plant of 50 megawatts.
(The cost has shot up to $80 million from $50 million in just two years.) In addition, 1,000 to 1,200 acres of land is needed to produce 50 megawatts of electricity. Obviously, this type of investment can be made mostly by a foreign investor, though local investors with impeccable professional profiles can also be co-opted in such projects.
Meanwhile, the skyrocketing oil prices in international markets have prompted governments to go in for such relatively cheaper alternative sources of energy. If properly harnessed, these sources can appreciably reduce our dependence on oil and gas. Pakistan's gas reserves are anyway said to be fast depleting, and we will have to depend on alternative resources.
The present energy crisis in Pakistan is essentially a result of failure of successive governments in ensuring timely implementation of power projects. Secondly, Pakistan's overwhelming dependence on oil and gas for meeting industrial and domestic requirements has been too high in the energy mix. As Pakistan has vast untapped hydel potential that can be utilised for meeting its requirements there is a need for us to restructure our entire energy strategy, with suitable priority given to the hydel sector.
Wapda's Vision 2016 programme is a commendable endeavour if it is properly implemented without loss of time. There is a need for the government to pursue a two-pronged strategy: long-term for hydel power generation, and short-term for tapping alternative sources of energy. Time is clearly of the essence as far as our depleting energy resources are concerned. The government must expedite implementation of power projects before the country's productivity is seriously affected.