The government considers IP gas pipeline as the most feasible option, compared to others, for meeting the growing energy requirements of the country, sources told Business Recorder. They said that the Economic Coordination Committee (ECC) of the Cabinet was informed that keeping in view the need of energy in the country, the IP projects appears to be the most feasible option.
They said that minutes of subcommittee of the ECC on gas import project show that the country would be facing severe gas crisis in the coming years. The Managing Director of Inter-State Gas System (ISGS) reportedly stated that, based on current estimates, gas demand would increase from present 4 bcfd to 12 Bbcfd by 2025. Moreover, indigenous gas supplies are expected to fall to 2 bcfd, to increase shortfall to nearly 10 bcfd. The ECC was informed that a study to determine the cost of power generation at Multan, using imported gas as well as other competing fuels, RLNG, HSFO and imported coal, indicated that IP gas, despite revised gas pricing formula by the Iranian side, is the most cost-efficient fuel. It was also proposed that as a strategy the country should develop additional IPPs so that these are ready to consume the gas when the project is materialised.
The estimates of Pepco, Wapda and the PPIB suggest that the country would be required to set up additional power generation capacity of nearly 11,000 megawatts (mw) to meet future electricity requirements. The Iran-Pakistan gas pipeline project in the Phase-1 would be able to support additional power generation of 5,000 mw. And economic impact of alternative fuels indicates that using IP gas would result in average annual savings of $ 1.217 billion against using RLNG as alternative fuel at crude price of $ 100/bbl. Using HSFO as an alternative fuel indicates that IP gas will result in average annual saving of $ 1.707 billion at crude price of $ 100/gb. About the economics of alternative options of solar and wind based generation, the meeting was informed that the projected electricity shortfall in 2020 is about 11,000 mw, and, given the technical limitations, such a large scale generation is not possible on solar energy, whereas, wind mills have availability of around 30-35 percent only.
To the questions about the economics of hydel and coal-based generation, the meeting was informed that the issue with the hydel based generation is the availability of hydel power round the year due to seasonal fluctuations in the availability of the water resources. Moreover, hydel projects required longer time period to set up as well as are highly capital-intensive and should be part of long-term energy plan.