The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions

The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions

The following article, “The Causes and Consequences of Energy Crisis in Pakistan and Its Solutions“, is written by Fahad Farooq, a student of Sir Syed Kazim Ali. In this article we will discuss about Causes of Energy Crisis in Pakistan this article is written on the same pattern, taught by Sir to his students, who scored the highest marks in compulsory subjects for years. Sir Kazim has uploaded his students’ solved past paper questions so other thousands of aspirants can understand how to crack a topic or question, how to write relevantly, what coherence is, and how to include and connect ideas, opinions, and suggestions to score the maximum.

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Outline

1- Introduction 
2- Energy crisis in Pakistan: A critical overview

3What are the causes of the energy crisis in Pakistan?

  • Stagnant economic growth and political instability
    • Evidence: Pakistan’s economic conditions constrain the construction of power generation plants.
    • Evidence: Lack of policy formulation and implementation due to the unstable political environment
  • Insufficient infrastructure and outdated power plants
    • Evidence: Inadequate transmission and distribution system and overloaded transformers, Report of special committee, Senate of Pakistan 2018
  • High transmission and distribution loses
    • Case in Point: According to a report published by NEPRA 2018, Pakistan’s energy sector currently has about 25% transmission and distribution losses.
  • Corruption and power theft 
  • Case in Point: Pakistan is ranked 117th among 180 countries in the Corruption Perception Index, 2018 by Transparency International.
  • Inter-provincial conflicts with water reserves and water disputes with neighbors
    • Evidence: Kalabagh Dam has not been completed due to inter-provincial conflicts.
    • Case in Point: Water disputes in Pakistan with India and Afghanistan affect Pakistan’s power sector.
  • Heavy rains and floods due to climate change
    • Case in Point: In 2010, a severe flood severely damaged Pakistan’s power sector.
  • More dependency on fossil fuels and oil-based resources for power generation
    • Evidence: Reliance on thermal power plants instead of hydel power plants has significantly increased its average cost.

3- What are the impacts of the energy crisis in Pakistan?

  • Increasing load shedding, unemployment, and poverty
    • Evidence: Pakistan is suffering from 5 to 12 hours of load shedding per day, which affects the daily routines of students and employees.
  • Rising circular debt and energy subsidies
    • Evidence: Due to high reliance on thermal fuel, circular debt and subsidies provided to the energy sector have increased.
  • Growing public unrest and the birth of social evils
    • Evidence: The energy crisis has made the lives of common people miserable. 
    • Evidence: The unemployment ratio is increasing daily, which is giving birth to other social crimes.
  • Impacting industrial and agricultural sectors
    • Evidence: The industrial sector has to cut down its production due to prolonged load shedding and rising electricity bills.
  • Decreasing foreign investment
    • Evidence: Due to the extreme energy crisis, foreign direct investment in the industrial sector has decreased.
  • Expanding environmental degradation and deforestation
    • Evidence: Pakistan has been suffering severe deforestation due to high reliance on thermal sources for power generation
  • Boosting political instability
    • Evidence: The energy crisis has caused extreme angst among the public, resulting in severe demonstrations against the government.

4- What are the pragmatic measures to overcome the energy crisis in Pakistan?

  • To improve governance and effective implementation of policies
  • To improve the efficiency of power plants and gradation of transmission infrastructure
  • To formulate strict laws to control power theft
  • To utilize renewable sources of energy for power generation instead of fossil fuels
  • To generate electric power from nuclear power plants
  • To build new dams for water storage and settle down inter-provincial conflicts

5- Critical Analysis
6- Conclusion

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Introduction

The energy sector of a country is the foundation of its socio-economic development. Thus, energy security has remained, and still is, the agenda of many developed country’s schemes. However, in developing countries like Pakistan, the energy crisis due to a shortage of energy is the talk of every day. Pakistan has faced operational, managerial, and technical issues in the energy sector for the last two decades. The country has to overcome the crisis to attain socio-economic development in all sectors of society. Bad governance and inadequate planning by incompetent political leaders are the major causes behind the crisis. In addition, electricity losses in transmission lines and consumer power theft significantly burden the country’s economy. This energy shortfall has affected the country’s industrial, agricultural, and economic sectors. As a result, the unemployment, poverty, and social crimes in the society have increased. However, there is nothing in the world that cannot be solved. Pakistan should formulate strict laws and thoroughly implement them to control power theft. Updating the transmission and distribution structure to reduce power losses is essential. Moreover, the government needs to create awareness among the public to use energy-efficient products. In a nutshell, Pakistan’s socio-economic stability is impossible without addressing the issues responsible for the country’s energy crisis. This essay discusses the causes and impacts of Pakistan’s energy crisis and the pragmatic measures to curb the issue.

Currently, Pakistan is suffering from an acute energy crisis. Approximately twenty per cent of the country’s population needs access to electricity. But it does not produce enough energy to meet the demand. There is an electricity shortfall of approximately 8000 megawatts per day; as a result, the population has been facing the haunting effects of load shedding for five to twelve hours per day. This situation reflects the incapability of the previous governments to curb the issue and a need for more implementation of formulated policies in the power sector.

Since every issue has a cause, Pakistan’s poor economic condition is the primary cause of its energy crisis. Huge investments are required to lay the foundation of power projects to attain energy security in the country. Unfortunately, Pakistan has been suffering the worst economic crisis since its inception, due to which the power sector has been neglected. In addition, Pakistan has been facing political instability for decades. According to the Global Economy Watchdog for Political Stability, Pakistan is ranked 192 among 195 countries. In such unstable circumstances, no solid and visionary policy has been formulated to enhance the country’s power generation capacity. As a result, the country’s power sector is facing an acute crisis.

Moreover, most of the projects being used for electricity production are outdated. Due to poor maintenance, these plants operate at an efficiency level much lower than the designed capacity. They consume more fuel and produce less energy; as a result, they tend to increase the circular debt, creating a burden on the federal budget through subsidies. These soaring subsidies have adversely affected the financial health of the economy. 

Furthermore, the high loss of electricity in the transmission and distribution system is a significant burden on the country’s energy resources. According to a report published by NEPRA 2018, Pakistan currently has about 25% T&D losses. 

Apart from wasting energy, these losses go without payment to the power generation companies, which the government compensates through subsidies. So, these T&D losses significantly drain the country’s economy.

Additionally, corruption in the energy sector and consumer power theft are other significant contributors to the country’s energy crisis. A lack of technology-assisted techniques for stopping power theft has further devastated the situation. Transparency International has ranked Pakistan 117th among 180 countries in the Corruption Perception Index, 2018. Over time, several corruption scandals have been exposed in the power sector, severely affecting its growth and resulting in a high loss to national expenses. In this way, corruption and power theft significantly escalate the country’s energy crisis.

Similarly, inter-provincial conflicts on water sharing in Pakistan have hampered the development of Pakistan’s power sector. Small provinces blame the large ones for not giving their share in water resources. This mistrust has destroyed the understanding among the provinces to cope with the energy crisis. Due to these conflicts, the development of new power stations like the Kalabagh dam could not be possible. Furthermore, Pakistan has also indulged in a water war with its neighbours, India and Afghanistan. Now, India has started building dams on western rivers, and Afghanistan has begun building dams on the Kabul River, which has caused a water shortage for power generation in Pakistan. This has severely affected Pakistan’s power sector.

Another cause of the energy crisis in Pakistan is climate change. Due the phenomenon, heavy rainfalls are becoming very common, which cause floods. These floods damage the country’s electrical power sector every year. For example, the severe flood of 2010 severely damaged Pakistan’s power sector. Due to the lack of dams, this excess water from floods cannot be stored for valuable purposes. Thus, extreme weather patterns due to climate change also contribute to Pakistan’s energy sector disaster.

Lastly, shifting from hydel power plants to thermal power plants has proved another massive drain on the country’s power resources. More reliance on furnace oil to run power plants has made the country more vulnerable to the fluctuation of international oil prices. The current Russia-Ukraine conflict has exposed the vulnerability of various nations, including Pakistan, to oil and gas to meet their energy requirements. In this way, the soaring oil prices in the international markets are badly affecting Pakistan’s energy.

As every crisis comes with some aftereffects, load shedding is considered its most significant effect. This has affected all sectors of society. Due to this, students cannot fully concentrate on their studies, and public and private sector employees need more time in their work. Due to the non-availability of uninterrupted electricity, factories have shifted to other resources like furnace oil and natural gas, resulting in increased production costs. As a result, thousands of employees across the country have been expelled from their jobs. In this way, continuous load shedding has increased the poverty in society.

Due to the lack of solid and versatile policies of the incumbent political leadership, the dependence of power generation on thermal sources instead of hydel energy has increased. This high reliance on thermal fuel has resulted in increased circular debt. The outdated and deteriorated infrastructure of power plants, accompanied by high transmission and distribution losses, has created a massive gap between the supply and demand of electricity. Power plants are consuming more fuel and producing less energy. Moreover, insufficient recovery of bills from consumers has created a massive gap in the costs of generation and payment of recoveries. Instead of increasing the power prices, the government has increased the subsidies provided to the power generation companies. Thus, the energy crisis has significantly burdened the federal budget through subsidies.

The power crisis has made life hell for the majority of the citizens. Frequent load shedding has contributed to the increased unemployment in society. This unpredictable load shedding has caused extreme angst and distress among the public; as a result, various social evils like robbery and street crimes have increased in society. The condition of the youth of the country is especially miserable. 

Similarly, the energy crisis has severely affected the industrial and agricultural sectors. They have to cut down their production and lay off thousands of workforce. Factories face early shutdowns, and the employees wait hours to resume work. Consequently, the net output of the industrial sector has decreased. This has resulted in increased prices of fertilizers, pesticides, and other ingredients in the agricultural industry. Moreover, being a water-scarce country, Pakistan’s agricultural sector is highly dependent on the power sector to use underground water for agriculture. Due to frequent shutdowns of electricity and high furnace oil prices, farmers face massive agrarian losses.

Due to the energy crisis, Pakistan is less likely to attract foreign direct investments in industrial sectors. There is a continuous decline in the existing number of industries in Pakistan. Maximum industries have been shifted to foreign countries, where cheap and reliable energy supply is available. Thus, the energy crisis in Pakistan has raised the cost of production.

Pakistan is highly dependent on thermal power plants and has been facing severe deforestation. Due to an unfortunate controversy among the provinces, Pakistan lacks hydel power projects. Besides this, the massive dependency on fossil fuels for electricity production has led to several environmental hazards, such as the emission of GHGs, global warming, and irregular weather patterns. Global warming has been the cause of severe floods in Pakistan for the last two decades, which has badly affected the domestic lives of ordinary people.

The long and often unpredictable hours of load shedding have caused extreme angst among the public, resulting in severe demonstrations against the government. Unfortunately, Pakistan is ranked 192 among 195 countries by the Global economy watchdog for political stability. Due to this political instability, there has yet to be continuance in the formulated policies to overcome the energy crisis in the country.

Every issue has a solution. First, the government should formulate solid laws and thoroughly implement them nationwide. There should be no political involvement in the power sector. The government should mainstream the issue of the energy crisis in the national narrative and try to develop a national consensus on this issue.

Furthermore, the government should focus on increasing the installed power generation capacity. Research centres should be established for prime solutions to power sector problems. The efficiency of the transmission and distribution system should be increased on a priority basis. The government should encourage the distributed generation to reduce transmission and distribution losses.

In addition, technology-assisted techniques must be used to stop power theft. The power sector cannot remain sustainable unless the service cost is fully recovered. The provincial governments and law enforcement agencies should assist the federal government in controlling power theft and the excessive losses in the transmission and distribution system.

Additionally, the country needs to shift from fossil fuels to renewable energy resources for electricity production like wind, hydel, and solar power projects to reduce environmental pollution and resolve the current energy crisis. Pakistan is enriched in hydro-power resources with the potential of 50000 megawatts, which is still untapped. The government should speed up the construction of hydel projects like the Diamer Bhasha Dam and other big projects like Dasu. The country should adopt renewable resources like wind and solar power as soon as possible to shift the trend from fossil fuel generation towards renewable generation.

Moreover, Pakistan should immediately enhance its nuclear power generation as it is cheap and reliable. Pakistan is 6th atomic power in the world but generates only a tiny amount of electrical power from nuclear sources. This will decrease the country’s dependency on foreign technology and imported fuels.

Lastly, being a water-scarce country, Pakistan needs to build more dams to store excess water in the monsoon season and use it in the dry season to run the power plants. For this purpose, the government should immediately settle the inter-provincial conflicts on major power projects, like the Kala Bagh Dam, to include bulk power generation into the national grid and avoid floods. Pakistan should negotiate with India and Afghanistan on critical water disputes as Pakistan’s power sector is highly dependent on the water received from these countries.

The energy sector of Pakistan has been facing an acute crisis for the last two decades due to incumbent political leadership, lack of formulation of solid policies and other technical issues. The situation has hampered Pakistan’s socio-economic development. With a dwindling economy and soaring political instability, the country needs immediate pragmatic steps to curb the issue for the smooth running of all the state’s sectors. If this issue is not resolved on a priority basis, the situation will become worse. In conclusion, the prolonged energy crisis has devastated the national economy. It has slowed down the industrial sector and affected all life sectors. It has caused inflation, unemployment, and poverty in the society. It has also damaged Pakistan’s international image. Multiple reasons behind the crisis, like poor governance, outdated power plants, transmission and distribution losses, power theft, inter-provincial conflicts on water resources and high dependency on thermal sources, need an immediate response from the government. And the adoption of renewable technologies can tackle the issue of outdated plants, reducing power losses, and implementing effective policies.

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