ISLAMABAD: An electricity and gas load management plan will, for the first time, apply to domestic consumers this winter to ensure uninterrupted supply to Punjab’s troubled textile industry.

A decision to that effect was taken on Thursday on the directive of the prime minister who is in London on an official visit.

“On the direction of Prime Minister Nawaz Sharif, the Ministry of Water and Power has asked all electricity distribution companies (Discos) to exempt the industry from loadshedding due to shortage of gas in the country,” an announcement by the ministry said.

In the absence of Petroleum Minister Shahid Khaqan Abbasi who also is in London, Finance Minister Ishaq Dar ordered restoration of full gas supply to textile units in Punjab after a meeting with a delegation of the All Pakistan Textile Mills Association (Aptma).

“The gas load management plan for textile units in Punjab has immediately been suspended,” said a statement issued by finance minister’s office.

Early this week, Khaqan Abbasi had decided to withdraw about 108mmcfd (million cubic feet per day) of gas from textile units, including their captive power plants, in view of increased gas demand by the domestic sector after temperatures suddenly dropped in the north.

Experts in the energy sector told Dawn that the new arrangement could not be sustained beyond a couple of weeks.

The domestic sector’s gas demand from the Sui Nor­thern Gas Pipelines Limited (SNGPL) system has inc­reas­ed from a summer requi­rement of 250mmcfd to about 400mmcfd, which is projec­ted to go beyond 900mmcfd after mid-December.

Informed sources said SNGPL had already been directed to scale down gas pressure from about 2600mmcf (million cubic feet) to 2450mmcf to enable diversion of natural gas from the residential to industrial sector. Some unspecified gas quantities will also be diverted from the Sui Southern Gas Company’s system, along with a further cut in supplies to CNG stations, to spare about 150mmcfd for the textile industry in Punjab.

In normal circumstances, textile processing units are provided about 54mmcfd. The textile industry is entitled to get gas supply for nine months under a contract with gas companies. The textile sector’s captive power plants get 56mmcfd, although they can be run on furnace oil, diesel and coal.

The country’s exports during the first four months of the current fiscal year declined by about 5.2 per cent, compared to the same period last year as large-scale manufacturing output remained flat at 4.2pc against 4.3pc, according to the finance minister.

The water and power ministry also directed Discos to immediately implement the plan for full electricity supply to the industry as desired by the prime minister. The decision will remain in place till canal closure in the end of December when hydel generation drops to a minimum level, necessitating maximum power generation from thermal stations.

Discos were “further directed to implement a load management plan for domestic consumers during the winter season, which will keep loadshedding at a minimum level”. Discos will implement the plan according to their own worked out schedule.

The sources said thermal power plants of about 1,800MW currently shut down because of expensive generation cost would be brought to the system by using furnace oil after the textile industry had shown willingness to purchase electricity even at higher rates if it ensured uninterrupted supply at least till Dec 25 when canal closure would set in and remain in place till the end of January.

The decision about uninterrupted power supply to the industry was taken in the wake of increased industrial activity, especially after the grant of GSP Plus status by the European Union.

Aptma and some other industrial associations had expressed concern over gas shortage during winter and requested the government to take measures to overcome it.

The Aptma delegation informed the finance minister on Thursday about the difficultly being faced by textile units in Punjab because of gas shortage and the load management plan which, according to it, was implemented a little ahead of schedule.

Finance Minister Isahq Dar, with the approval of the prime minister, directed the secretary of petroleum and natural resources to suspend the gas load management plan. Instructions were also issued to restore closed connections, a statement said.

Aptma was of the opinion that suspension of gas supply from November till March would adversely affect the textile industry and cause a huge decline in export earnings. It said that most of the textile units relied on cheap gas to compete with neighbouring countries and avail themselves of the GSP Plus facility.

Suspending the gas load management plan for the time being, Mr Dar told the Aptma delegation that a final decision on the matter would be taken after the return of ministers for water and power and petroleum from abroad.

Published in Dawn, November 14th, 2014