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Nine months and running. Electricity generation has continued to dip year-on-year. This has never happened in at least 20 years. But then Pakistan’s current economic state it probably also its lowest point in well over 20 years. The LSM growth has tapered off month after month and is likely to be in negative double digits by the yearend. Electricity has become dearer for most consumers, and that will invariably have an impact on demand.

But there is no way to ascertain if reduced electricity generation is a direct consequence of reduced purchasing power as tariffs have gone up for all and sundry, to varying degree in the last few months. There is an equally good chance of reduced power generation being a result of deliberate attempts to save fuel as the country struggles for dollars. The best bet which makes most sense is that a combination of both factors is at play here. Detailed analysis can be made once granular hourly load data, peak demand, transformer loading data is available in public domain. That won’t be soon.

February has historically been the lowest demand month, and a return of hydel generation’s share at over one-quarter is always welcome. It again appears that technical shortcomings and lack of planning foresight are more to blame than failure to procure fuel in time. Coal based generation for February stood at a billion units –or 14 percent of the total. This is the joint-lowest coal based monthly generation in five years.

And coal was not sitting very low on merit order of dispatch in February either. Consider this that 500 million more units were generated by imported LNG at an average Rs23.36/unit. Coal based generation on the other hand had Rs12.57/unit fuel cost associated with it. RLNG fuel cost was in fact dearer than average RFO based generation fuel cost, although that is largely because the most efficient RFO plants were run due to low demand. Inability to evacuate power from efficient plants running at full capacity, the criminal negligence in connecting Thar based plants to compatible lines with the grid – meant the consumer will end up paying for more inefficiencies, as monthly FCA will again be higher than reference fuel cost, which is already 70 percent higher from a year ago.


Comments are closed.

Haq Mar 21, 2023 10:57am
Govt is too busy in taxing & corruption, couldn't understand the fact that increasing electricity tariffs (as well as petrol, diesel, gas) will impact business, industries & economy. Exactly what IMF & it's planted agents wants, anhilation of Pakistan (politically, socially, economically)
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Az_Iz Mar 22, 2023 03:19am
Why didn’t the country start using Thar coal, instead of building plants on imported coal and RLNG.
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