Islamabad- Since Pakistan is facing numerous challenges for the last many years, power crisis playing a major contributory factor have shaved off annual GDP growth to two percent, thus stuck the GDP at a level, which is half of country’s long-term trend potential of about 6.5 percent per annum.   With rising demand of electricity every year and following current position of expansion, power crisis seems not to be over which in turn will effect economic growth of the country.

“The critical issue is that according to National Transmission and Dispatch Company (NTDC), the annual electricity demand growth rate is forecasted to hover around 5 to 6 percent over next ten years. With current position of expansion, it seems that crisis will not be over which in turn will effect economic growth of the country,” revealed Pakistan Economic Survey 2012-13 launched here on Tuesday.

The survey revealed that circular debt, weak financial position of energy companies, falling gas production, high dependence on oil/gas (over 80pc), low exploitation of indigenous coal and hydel resources and unutilized power generation capacity is some of the significant constraints leading to severe energy shortages. It said that Pakistan’s power sector is heavily depended on gas and reduction of gas has crippled its performance. The country is witnessing gas shortage due to misallocation of natural gas and low growth in its supplies. Pakistan’s electricity generation is highly dependent on imported oil as almost $14.5 billion worth of oil is imported each year, the bulk of which is used for electricity generation.

“Thus pronounced shift from hydro to thermal generation, and more recently from natural gas to fuel oil as the primary fuel for electricity generation have caused fuels crises in Pakistan’s power sector. Further these trends have contributed to an increase in power supply costs,” Pakistan Economic Survey revealed. It urged for immediate shifting of fuel mix from expensive to cheaper. The generation capacity also could not be operated at full due to constraints in fuel availability and timely payments.

As of March 2013, the number of consumers has been increased to 21.704 million. Even during the current year 2012-13, the consumption pattern, more or less, remained the same having domestic share of 43 percent, industrial 26 percent and agricultural about 11 percent. It is expected that 1000-1200 MW wind power projects would be added to the national grid by 2015 if land is allocated to the new projects.

Pakistan Atomic Energy Commission (PAEC) is responsible for planning, construction and operation of nuclear power plants i.e Karachi Nuclear Power Plant (KANUPP) and Chashma Nuclear Power Plant Unit-1 and 2 (C-1 & C-2). The construction of two more units C-3 and C-4 is in progress. The commercial operation of the under construction nuclear power plants C-3 and C-4 of 340 MW each, is planned in December 2016 and October 2017, respectively.

During FY 12 the import bill of petroleum group was $15.2 billion. If to look it in quantity terms it was 19.2 million metric tons including 13.2 million metric tons of petroleum products and 6.0 million metric tons of petroleum crude. However, during July-March FY13, it posted a negative growth of 0.53 percent due to fall in quantity (negative 0.18 percent).The main reason attributed to decline is declining prices of petroleum products globally and fall in consumption.

Overall there was negative growth in the consumption of gas during Jul-March 2012-13. The analysis of the sectoral consumption of gas indicates that during July-March 2012-13, the highest share in consumption of gas remained in power sector (27.5pc) followed by industry (22.6pc). As the government accorded priority to provide gas to household, the share of household in gas consumption remained 23.2 percent. However, the trend of providing gas to power sector is declining since 2005-06 except in 2012 there was positive growth of 6 percent. The transport sector is the other significant sector that posted a positive growth in gas consumption of 5.3 percent during 2011-12, however, during July-March 2012-13 negative growth of 16 percent has been witnessed in this sector. Although its share in total consumption of gas has increased from 0.6 percent to 9 percent in last ten years, but now due to load management its growth is declining. Over the time period the share of fertilizer has declined but still its share is significant (16pc), however there was negative growth of 7 percent in 2012 when compared with last year. During July-March 2012-13, its growth further declined to 12 percent.  It is expected that gas will be supplied to approximately 39,000 new consumers and about 350 new towns/ villages will be connected to the gas network during the fiscal year 2013-14.

Gas utility companies have planned to invest Rs 17437 million on Transmission Projects, Rs 27,265 million on Distribution Projects and Rs 11,165 million on other projects bringing the total investment of Rs 55,867 million during the fiscal year 2013-14.