Energy crisis

Pakistan’s energy sector faces a precarious situation marked by inefficiencies, over-reliance on fossil fuels, and unsustainable consumption. Despite a 12% increase in installed capacity to 45,662 MW in FY23, actual electricity generation dropped by 10%, indicating an energy system grappling with contradictions. The reliance on costly imported fuels, erratic seasonal demands, and disproportionate payments to Independent Power Producers (IPPs) has burdened the economy with a staggering PKR 2 trillion in capacity payments. This unsustainable model hinders industrial growth, while depleting natural gas reserves and rising costs for coal imports further exacerbate the crisis. The country’s failure to fully embrace renewable energy exacerbates its challenges, as only 7% of power generation (excluding hydro) comes from renewables, far below the 30% target outlined in Pakistan’s Nationally Determined Contributions (NDC) commitments.

The transition towards sustainable energy remains slow due to policy inertia, financial constraints, and limited infrastructure. With global mechanisms like the EU’s Carbon Border Adjustment Mechanism (CBAM) threatening exports, especially textiles, Pakistan risks losing competitiveness. Integrated energy planning is critical to bridging economic and environmental goals. Programs like the World Bank-backed fan replacement initiative and the adoption of Energy Conservation Building Codes (ECBC-2023) highlight achievable solutions. Transitioning to a competitive electricity market, paired with renewable energy initiatives such as rooftop solar and electric vehicles, could pave the way for a just energy transition. However, without political will, federal-provincial coordination, and civil society oversight, Pakistan’s energy security goals risk remaining pipe dreams.

Overview:

The article emphasizes Pakistan’s energy challenges, focusing on inefficiencies, over-reliance on fossil fuels, and delayed adoption of renewable energy. It stresses the importance of integrated planning, market reforms, and conservation measures to ensure energy sustainability and economic growth.

NOTES:

Pakistan’s energy crisis stems from systemic inefficiencies, fiscal mismanagement, and over-reliance on fossil fuels, which account for 52% of electricity generation. Despite a 12% increase in installed capacity to 45,662 MW in FY23, electricity generation declined by 10%, revealing a paradoxical situation where surplus capacity fails to meet industrial demand. The dependence on imported fuels and seasonal electricity needs adds financial burdens, with capacity payments to Independent Power Producers (IPPs) exceeding PKR 2 trillion annually. Moreover, renewable energy contributes only 7% of electricity generation, far below Pakistan’s target of 30% by 2030. Addressing these challenges requires integrated planning, market reforms, and efficient governance. Steps like adopting Energy Conservation Building Codes (ECBC-2023), transitioning to a competitive electricity market, and fostering public-private partnerships are critical to alleviating the crisis and ensuring sustainability.

Relevant CSS Syllabus Topics

• Environmental Science: Sustainable development, renewable energy, climate change.
• Pakistan Affairs: Economic challenges, industrial growth, energy policies.
• International Relations: Global mechanisms like CBAM and their impact on Pakistan.

Notes for Beginners

Pakistan’s energy problems arise from inefficiency, expensive power generation, and reliance on fossil fuels, which are running out and costly to import. For example, despite having enough power plants, the electricity produced has decreased because industries use less energy. The government also pays private power producers even when they don’t supply electricity, costing billions of rupees annually. Renewable energy like solar and wind power is underused, contributing only 7% of total electricity production, though it is cheaper and cleaner. To solve this, Pakistan needs better planning, policies that support solar energy and electric vehicles, and programs to save electricity, like replacing inefficient fans and improving building designs.

Facts and Figures

• Installed capacity: 45,662 MW in FY23, yet electricity generation dropped by 10%.
• 52% of electricity is generated from fossil fuels, contributing to $100 billion in annual inefficiencies.
• Capacity payments to IPPs exceed PKR 2 trillion.
• Renewable energy accounts for just 7% of power generation (excluding hydro).

In a nutshell, Pakistan’s energy dilemma demands a paradigm shift toward sustainability and efficiency. By embracing renewable energy, competitive markets, and conservation measures, the country can alleviate economic strain while safeguarding its environment. Effective governance, political will, and public-private partnerships will be important in steering Pakistan toward a brighter, energy-secure future.

Difficult Words and Meanings