Pakistan’s dependable electricity generation capacity stood at near 31000 MW by the end of July 2018. That is up from 24500 MW in the same period last year. The 26 percent increase in dependable capacity though, does not necessarily mean, reduced load shedding or increased power generation by the same magnitude, hence, the load shedding.
That said, Pakistan’s electricity generation has continued to improve as July 2018 saw 13397 Gwh of electricity generated, up 9 percent year-on-year. This goes on to show all those 11000 MWs added in the system are not necessarily pumping in power at full steam, for a variety of reasons. But there is improvement in power generation nonetheless, and more importantly, the ailing power generation mix seems to be going in the right direction.
All this while, Pakistan’s power generation remains highly dependent on hydel generation. Any signs of low water levels in the reservoirs, and almost on cue, the FO based generation goes high. But that is gradually changing; as more and more LNG based generation are coming online and reaching better utilization levels.
The fact that LNG based power generation now accounts for one-fourth of total generation, is heartening. It has come a long way from being just 12 percent of the total generation a year ago. The substitution has come at the cost of furnace oil based power generation, the share of which has gone down form one-fourth a year ago to less than 10 percent.
The rapid rise of coal power plants has also added to the reliability of the overall generation system, as the share has moved steadily from 3 percent last year to 13 percent in July 2018. Power generation from natural gas has declined slightly, sanding at 15 percent – which has allowed for more efficient and productive usage of the precious resource at industrial and commercial levels.
With the availability side of the equation going rather smooth, the same cannot be said of the other side of the equation, that is, affordability. The average fuel cost has gone up by 14 percent from last year, and the total fuel component bill for July 2018 was 25 percent higher year-on-year, with 9 percent more generation. Strict enforcement of merit order based generation will now have to come in practice.
Should the power generation mix continue to improve, as widely expected, as RLNG and coal power plants gather steam – the weighted average fuel cost is slated to come down. But that will have to be met with serious work on the recovery, collection, distribution, and financial aspects of the energy chain. Status quo on that front, threatens to undo the grounds gained on improved generation mix. Now is the time for action!
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