Energy in Pakistan has always been a sore point, especially because availability waxes and wanes and so does the policy. Public policy is most deficient and has always remained subservient to the political needs of the days. The public is so gullible that it worships whoever promises salvation – be it indigenous development, autarchy of supplies or something soon to be found off-shore. The old myth that basically one of our western neighbors is, tangentially pumping oil from our side of the border carries-on. Pipe-dreams like the IPI (re-christened now as the IP only), the latest being that we would basically swap Central Asian gas with the Iranian one to go around any possible US sanctions et alia, TAPI and the 2xTAPI are all accepted by us as possible redemption for our sins. The sins, unfortunately, are one too many. And all of these can be charged to the continuing non-professional governance of the Energy Sector.
Presently, the energy cocktail is made up primarily of electricity, indigenous (system) gas, LNG, LPG, Coal and some other petroleum products. These are competing with each other – although all of these are energy – simplistically speaking. The sad part, however, is that these sources or fuels are being primarily used for producing electricity (barring electricity itself), fueling transport, running some part or the industry itself, space and water heating and for cooking. These have different and varying BTUs. The economics of all of these fuels are also different– leading to most inefficient usage for most activities.
Additionally, we see that the supply level of these energy sources is also different for each category. In Pakistan, the infrastructure for producing (drawing-out gas and oil), transporting and distribution of these fuels is not the same. It is much more mature for electricity with the age old national grid in place, while coal transportation has its own hazards, beside the serious constrictions. Safety, in case of LPG and LNG (virtual pipelines specifically) is another show-stopper to contend-with. So much are the issues involved, that PSQCA has been unable to assure implementation of its specs and standards for cylinders – what to speak about bigger systems and modules. Every now and then, an explosion wakes us up from the present stupor. All this calls for a consensus not to keep-on paying and maintaining for the needed infrastructure of competing energy sources. Indeed, the vested interest would sabotage efforts to correct the present skew in the national energy landscape. In other words, economics, including the ease of use of a particular source of energy, should be the over-riding factor for selection of the preferred fuel regime.
And in order to select the specific energy source, it is important to chart the energy usage (as a whole) of the Country in TOE. We, thereafter, need a comparison of all these in shape of the requirement of each fuel to generate one MWH. There would be a matrix showing the availability of each fuel / energy source and the probability of confirmed availability (this could be based on data of the last five years or so – while any numbers of prior periods are trite now). Additionally, an effort will be made to come up with the probable cost of environmental impact of each source for harvesting the same, transporting it and then using it along-with the distribution systems. An effort too will be made to come up with cogent recommendations for possible investigation of environmental issues/effects at the source of the particular energy/fuel and the economics of such mitigation for the transportation and distribution systems. All of this data should form the basis for the needed informed decision. Environmental impact of each fuel in the fuel supply chain, the comparison of concentrated power generation of coal such as the Thar mine-mouth power plants in low population density areas and issues relating to myriad plants of localized generation for industry, will need to be studied. While, the concentrated electricity generation can be improved by flue gas treatment, etc. – if required, in case of localized generation, the pollution is spread throughout the value chain, i.e., extraction, processing, transportation, storage and end-use. In other words, we see that mine-mouth power generation at the utility level economically outstrips any such activity at individual industrial sites, etc.
In addition, the reading of the related data is very interesting and leads straight away to very cogent recommendations. In the order of precedence, it is seen that electricity remains at the top of the chart followed by local coal – but that too, if the issues involved in processing and transporting it (along with the environmental cost) are ignored. In case the need for transportation is somehow done away-with, then coal improves in ranking – which fortifies the case for its mine-mouth usage. Further study suggests that the top-most and efficient conversion from any source, is electricity, be it: gas/LNG, coal, RFO/FO (petroleum) and also solar, wind and water/hydropower. It is a fact that conversion of any of these fuels to direct usage or on the intermittent basis for electricity first and thence for industrial, commerce or residential usage at individual basis, is most loss making, while conversion to electricity generation at the utility scale, including the transmission and distribution costs incurred to reach the customer mains, is way more efficient and cost effective. Here the case for priority induction of EVs (electric vehicles) is also touted.
The above data and the corollary drawn out as a consequence, lead us to the thesis that Pakistan must convert itself to a Single Fuel Country in the shortest possible time period. That, it would have to, in turn, strengthen the National Grid (NG) to be able to deliver the new regime is a foregone requirement. At present, the NG caters to only 64.5% of the population and a little less %age of the geographical area of Pakistan. Consequently, it will have to be extended in a phased manner – to be able to satiate the industry first and then onwards for commerce, agriculture and residential demands. It will be a tall order while considering the current tardy progress by the NG – actually, it needs to be firstly buffeted in the existing areas and then extended any further in a phase wise manner.
So as to proceed and succeed in the least possible time, the MOE and the Planning Division will have to jointly take stock of the things and then move towards implementation of the Single Fuel (usage) Regime. It will be difficult unless undertaken as a national policy. The policy thus has to be formulated at the earliest and in an all-encompassing manner.
The first would be to propagate the advantages of the single fuel regime – especially, when local gas is dwindling fast and while there seem to be no chances (under the existing non-professionalism) at all for any new petroleum finds in the Country. Second would be the census of equipment / systems in vogue at the consumer-end (industry, commercial and domestic) to list what exactly to be has replaced. Once this is known, then a plan will be firmed up to assist the change from the existing myriad fuel usage to electricity alone. It may be difficult if not assisted by the State – however beneficial. As such, all of the tens of agencies/departments/set-ups of the federal and provincial governments have to be moved together in unison — in support of the change. Probably, the stewardship for actual transition could be NEECA — the recently set-up, but nascent Authority in front of us. At the moment, it is all dressed up with nowhere to go. NEECA, originally set-up as the ENERCON and being shifted from one ministry to the other, etc., would make a great study as to how not to run a public sector entity.
NEECA as the coordinator, with support from both the MOE and the Planning Division, will ensure that all modules of the change are implemented. As banks and other financial houses too are to be roped in for the change, NEECA would be in touch with such entities to maximize the benefits of each rupee available or used for the change.
How does the beneficiary of the change to electricity, pay off the loan(s)–if availed? While remembering that induction of the single fuel regime will spur energy efficiency and then result in improvement in the actual energy scenario, we see that firstly, ease of use would be evident and then EE (energy efficiency) would lessen the monthly energy bill. The fiscal space thus created will be able to assist pay-off in the long run, but the best would be the ease for the end-user to stop thinking for arranging the multiple sources of energy – just to have sustainable energy inputs. This alone is a great boon as presently the luckless entrepreneur is wasting many man-hours just to plan the best and most affordable of the energy concoctions for his works. This time can be better put to use for improving the core business and allied processes/systems.
The issue then is the buffeting of the NG as a national policy. This is easier said than done – especially, when the Regulator NEPRA, the NTDC and the DISCOs all need to change their tardy and medieval spots. The buffeting needs finance as the power infrastructure is finance intensive – requiring induction of the latest technologies at a huge cost. Indeed, the WB and ADB are great sources to rely upon, but huge outlays in the realm of around Rs 200 billion have to be provided-for from the national budget each year. And the scheme of things has to continue for straight five years, whereafter profitability of the energy sector would start paying for future sustenance.
As we would be moving towards a single fuel regime, the preferred single fuel has to be available 24/7 and in ample quantity and surely in quality too. The NG, inclusive of the CPPA (G) contracted generation assets and the distribution lines, would thus have to fully adhere to the standards set-up by the Regulator Nepra or face punitive penalties. This is so because now the consumer will not have recourse to any other source and nor would the earlier various competing sources vie with each other.
In other words, the GOP through the Regulator/Nepra/Ogra has assured all of the above, while the MOE has to implement the policy in its totality.Engr Tahir Basharat Cheema, "A single fuel regime for Pakistan," Business recorder. 2023-11-29.
Keywords: Social sciences , Public policy , National policy , Political needs , Energy sector , Oil development , Electric vehicles , Environmental impact , Pakistan , NEECA , Nepra , TAPI , LNG , LPG , PSQCA , MWh , NTDC