No sooner had the rains lashed Karachi, the residents of the greater metropolis had to endure yet another day without electricity. On the 10th of September 2005, the heavy rains caused 12-hour prolonged electricity outage in many areas. Similarly, there was a 5-hour power breakdown in some parts of the city on the 1st of September.
Earlier, on the 8th of August the city plunged into darkness, due to a major power breakdown, for consecutive eight hours; in some areas even up to twelve hours. During summer too (April-June 2005), there were frequent breakdowns and voltage fluctuations experienced by the residents.
Undeclared load shedding is a matter of routine and quality of consumer services remains poor. Interruption of water supply and industrial production, as a result of frequent power breakdowns and fluctuations, has adversely affected trade, economy and civic life in Karachi.
There are a number of factors attributed to the bleak scenario presented for electric supply in Karachi these days. First and foremost is the shortfall in power generation capacity of the Karachi Electric Supply Corporation (KESC) that was not allowed to undertake required capacity additions, whereas its existing capacity de-rated over a period of years.
Secondly, its transmission and distribution network is ill maintained, outdated and inadequate.
Then, there are extremely high system losses --over 40%-- mainly due to large-scale theft across the distribution network. In short, the KESC is at present confronted with power crisis, as it has not been able to cater to the growing power needs in its jurisdiction that is spread over a total area of about 6,000 square kilometers. Over and above, inordinate delay in the KESC privatisation process, which has been going on since 1997 and has not yet been concluded, has further deteriorated the situation.
The transmission and distribution network dates back to the 1960s, although the KESC has been progressively replacing partially the older facilities until the 1990s. KESC has constructed 9-km long 132 kV transmission line in 1990 and another 40-km long 132 kV line in 1994, whereas 68-km long 220 kV line was constructed for Bin Qasim power plant in 1994.
The last project, known as Sixth Power Project, for the construction of 220 kV and 132 kV transmission lines was completed in 1998, with the financial assistance of $86 million through Asian Development Bank. Currently, the HUBCO-KESC interconnection, comprising of 500 kV and 220 kV transmission lines and 500-kv/220-kv switching station, is under construction. On completion, sometime in 2006, this link will enable the KESC to directly purchase electricity from Hub Power Company (HUBCO).
In 1992, additional 13 grid stations were constructed by the KESC, under the UK grant. Since then there has been no additional investment in this direction though power load increased manifold, meanwhile. It is only in recent times that the KESC has planned to expand its existing distribution facilities.
A total of 12 grid stations are to be established in Karachi. Out of these, order for construction of three grid stations has been placed recently.
Looking at the KESC's power generation infrastructure, it transpires that currently the integrated utility company has in total an installed capacity of generating 1,756 MW (megawatt) electricity that contributes 9% share in total installed capacity in the country (Table-1).
TABLE-1

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KESC POWER GENERATION
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S.No   KESC power stations                  Installed    De-rated generating
                                           capacity (MW)     capability (MW)
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1.     Bin Qasim thermal power station        1,260                    1,000
2.     Korangi thermal power station            316                      200
3.     S.I.T.E gas turbine power station        100                       90
4.     Korangi Town gas turbine power station    80                       70
TOTAL                                         1,756 MW              1,360 MW
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The KESC owns four thermal power stations. The two oil and gas based (dual-fuel) power plants are Bin Qasim power station having generation capacity of 1,260 MW and Korangi thermal power station of 316 MW, whereas SITE gas turbine power station has 100 MW installed capacity and Korangi Town gas turbine power station that of 80 MW. Nonetheless, at present these power plants have de-rated generation capability. For example, Bin Qasim power station is hardly operating at 70% of its installed capacity. Thus, the actual power generation capability of the KESC-owned power plants is around 1,400 MW, which is much lower than actual demand in its licensed area. To meet the supply-demand gap, the KESC purchases 250 MW power from the two IPPs (Independent Power Producers) located in Karachi, namely Tapal Energy and Gul Ahmed Energy (Table-2).
TABLE-2

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KESC POWER PURCHASE FROM OTHER SOURCES
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S.No  Power stations connected              Installed     Power purchase by
      with KESC system                      capacity (MW)         KESC (MW)
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1. Tapal Energy power station                  126                      120
2. Gul Ahmed Energy power station              136                      130
3. KANUPP nuclear power station                125                       80
4. Pakistan Steel Mills power station           50                       20
TOTAL                                          437 MW                350 MW
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In addition, PAEC's Karachi Nuclear Power Plant (KANUPP) and Pakistan Steel Mills supply 80 MW and 20 MW electricity, respectively, to the KESC. Also, WAPDA provides additional 500 MW electricity to the KESC that has interconnection with WAPDA's transmission and grid system.
During the year ending 30th June 2004, the KESC system generated and purchased a total of 13,392 GWh (gigawatt-hour) electricity and managed to sell only 7,818 Gwh to its 1,749,473 industrial, commercial, agricultural and domestic consumers, while lost the rest to theft and system inefficiency.
Having resorted to above arrangements, KESC has managed to meet power needs of Karachi so far. But with a 6% to 7% yearly increase in demand and with no growth in its generation capacity in sight, or that of the IPPs, it may find it more difficult to meet the challenge any further.
The situation is further compounded because of the fact that the useful life of the KESC plant machinery had been depreciated to the extent of nearly 60 percent, and many of its power units would be retiring shortly. One unit of Korangi thermal power station has already retired, in 2002-03, whereas its another two units will retire in 2004-05 and 2007-08.
Likewise, Korangi Town gas turbine power station will retire in 2007-08, and SITE gas turbine power station in 2008-09. Two units of Bin Qasim power station are due to retire in 2013-14 and 2014-15, whereas the KANUPP is scheduled to retire in 2005-06, if not re-furbished by then. Due to increased load in its own area, the WAPDA will also not ensure continuity of power supply to the KESC as WAPDA itself would face power shortage in its system beyond 2005.
Not that power shortage in Karachi should have come as a surprise to anyone, lest the utility company. In fact the policymakers had cautioned much earlier. It was projected in 2002 that Karachi would have acute shortage of electricity, to the level of 394 MW in 2005 and 506 MW in 2006, as no new projects, either by the KESC or the private sector, were under construction in the area. Pakistan Economic Survey 2002-03 too highlighted power shortage of 500 MW in the country in 2005-06, according to normal power load projections. Consequently, Power Policy 2002 was announced in October 2002, and duly implemented.
The Private Power and Infrastructure Board (PPIB) acted in time to solicit proposals from private sector to set up power plants, especially in Karachi, on priority basis. In response, a fast-track project was proposed by GSB Technologies of the USA, along with Pakistani partners, in July 2004.
The barge-mounted power project, which was envisaged as a gas-based combined cycle unit of 200 MW capacity, was to be set up at Port Qasim, Karachi at an estimated cost of $150 million. Ministry of Petroleum and Natural Resources made firm commitment for supply of required quantity of pipeline quality gas from existing network for an initial period of five years. In spite of full facilitation by the PPIB and support extended at higher government levels, the sponsors failed to fulfil the requisite procedural and legal formalities by the deadline that was extended a number of times. Due to non-seriousness and possible lack of financial capability on the part of sponsors, there has been no progress at all on this project, which was scheduled for commissioning by April 2006.
There are, however, several power projects planned to deliver additional electricity to the KESC system (Table-3).
TABLE-3

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POWER PROJECTS PLANNED FOR THE KESC SYSTEM
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S.No  Power Project to be connected   Capacity (MW)   Estimated Commissioning
      with the KESC                          system                    (year)
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1.    IPP Projects:
       DHA (Defence Housing Authority) Power    80                       2007
2.    Western Electric Power                   150                 2007- 2008
3.    Fauji Korangi Power (Fauji Foundation)   150                 2007- 2008
4.    KESC Projects:
      Korangi Thermal Power, new unit          300                       2009
5.    Korangi Thermal Power, new unit          300                       2010
6.    Korangi Thermal Power, new unit          300                       2011
7.    Korangi Town Gas Turbine, new unit       200                       2013
8.    SITE Gas Turbine, new unit               200                       2014
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In all, work on three thermal power plants to be established in Karachi will be undertaken shortly. The UAE government had gifted, sometime in August 2004, a gas-based thermal power plant, with a cumulative capacity of 512 MW, which though has completed 15 years of its operational life.
These units were initially to be established in the Punjab. In view of severe shortage in Karachi however, gas turbines of total 432 MW capacity will now be installed in Karachi, whereas the remaining unit, of only 80 MW capacity, will be set up in Faisalabad.
The plant is yet to be dismantled, transported and relocated to these sites in Pakistan. Obviously, the plant machinery will require major overhauling and refurbishing, which in turn will heavily depend on availability of required spare parts of old model turbines that has not yet been ascertained.
In any case, the whole exercise to put the plant in operation again will entail reasonable time and significant amount in foreign exchange and local currency. As more than a year has already passed without any progress on Pakistan side, a realistic timeframe for its going on stream, if at all feasible, can not be estimated at this stage.
The 80-MW power plant being installed by the Defence Housing Authority, which is schedule to be completed in 2007, will hardly provide any relief to the KESC. To recoup its de-rated power generation capability of about 400 MW, KESC will therefore undertake extension of Korangi power station, by adding another 350 MW combined cycle power plant. The project feasibility study was conducted years ago and the KESC had sought project approval sometime in November 2004. In a belated move, the government has given go-ahead signal to the KESC only recently. It is expected that the contract for project construction would be awarded on international competitive basis, for which preparation of tender documents is in hand. The plant, costing about $240 million, will take five years, from now on, to be operational.
Under the circumstances, it seems, KESC will have to pin all its hopes on the forthcoming IPP project, namely Western Electric Power. The 150-MW capacity plant, which is to be constructed at a cost of $112 million, is based on diesel engine technology using natural gas as primary fuel.
It is scheduled to go into operation by early 2008, in case tariff negotiations are finalised within a month or so, which were delayed due to the on-going KESC privatisation process. Another project, Fauji Korangi Power Project with a capacity of 150 MW, is to be installed in Karachi, by Fauji Foundation, for which feasibility study has recently been completed and approved by the PPIB. In case everything moves as per schedule, this dual-fuel gas-fired power project will be commissioned earliest by the end of 2008.
There is no respite for Karachiites in coming years, as far as power shortage is concerned. According to a recent study conducted by foreign consultants, electricity demand in Karachi will go up from present actual 2,023 MW, as in June 2004, to 2,502 MW forecast for the year 2008. Thus the demand load will be much higher than firm supply from overall KESC system at that time, under the given conditions, resulting in larger supply deficit.