Hydroelectric power is considered to be the cheapest and cleanest form of energy. It remains the most commonly used resource for generating renewable energy worldwide.
However, Pakistan has failed miserably to harness this indigenous energy resource. Ever since its creation in 1958, the Water and Power Development Authority (Wapda) has added only 7,116MW of hydropower, or a little less than a third of the country’s total nameplate power generation capacity, to the national grid in spite an estimated identified resource of more than 60,000MW.
Several factors like inter-provincial discord on mega water storage projects, corruption, lack of funding for hydropower projects, etc, have contributed to the slow progress on hydropower generation. Moreover, the policymakers’ obsession with the controversial Kalabagh dam also created roadblocks in the way of hydropower development.
Almost all planned hydropower projects were put on the back burner once the focus of the country’s decision-makers shifted, in the early 1990s, to thermal power generation based on imported oil in the private sector, owing to lack of funds, as a quick fix for electricity shortages, etc.
Consequently, according to the Nepra, the power sector watchdog, the energy market investments were caught up in confusion. Most hydropower projects either could not move beyond the early feasibility stage or faced cost overruns and time delays because of the change in focus. Ghazi Barotha is the only major hydropower project that has been completed in decades.
Nonetheless, the rising prices of thermal electricity appears to have returned the policymakers’ focus on harnessing the country’s hitherto untapped hydropower potential and increasing its share in the energy mix to keep down the average cost of power generation.
According to the plan, the government intends to add more than 16,000MW of hydropower — 10,997MW in the public sector and 5,347MW in the private sector — to the system by 2024. At present only 3pc of hydropower generation or 214MW is owned by private companies.
Since 1958, Wapda has added only 7,116MW of hydropower to the national grid in spite an estimated identified resource of more than 60,000MW
“Today’s Pakistan is facing the twin problems of water and electricity scarcity. In case of electricity, we need more generation capacity at affordable prices. Part of the solution for these issues lies in the simultaneous development of new water storages and hydropower generation in the country,” Muzammil Hussain, Wapda chairman, told this writer in an interview last week.
“We have wasted a lot of time. Out of 142maf water (available to us under the Indus Basin Treaty), we have a capacity to store only 15maf or 10pc. Another 30maf or 20pc, worth $15bn, is allowed to flow directly into the sea. As a consequence, we have become a water-stressed nation. Same is the case with hydropower as we have harnessed only a fraction of the potential resource (in more than 55 years) despite it being the cheapest and cleanest source of renewable energy.”
Ever since he took over at Wapda in August last year, Mr Hussain has made arrangements to complete long-delayed water and power projects like Tarbela Extension IV, Neelum Jhelum Hydropower Plant (NJHPP), etc.
“I have convinced the government to build the water reservoir of the Diamar Bhasha project from our own resources. Wapda will spend Rs100bn a year for seven years to build the reservoir. The money would be raised through bank loans and a yearly grant from the federal government. It would then be easier to obtain funding for the power house after completing the water reservoir,” the Wapda chairman said.
Similarly, he has arranged Rs10bn in federal money to complete the Kachhi Canal project up to Dera Bugti in Balochistan by December to irrigate 72,000 acres of land. “The project is facing cost overrun and time delays like most other water and hydropower schemes. We will need another Rs45bn to complete the canal network that will irrigate another 100,000 acres of land in Balochistan beyond Dera Bugti. But we can wait for that”
Talking about hydropower projects, he said Wapda will add more than 2,600MW of hydropower to the national grid by end of 2018 by completing the long delayed NJHPP, Tarbela Extension IV and Golen Gol. Another 8,070MW capacity will be brought on line between 2020 and 2024 by completing Bhasha, Tarbela Extension V and Dasu projects.
He said the projects like NJHPP, Tarbela Extension IV and Dasu had incurred cost overruns and time delays because most of them were launched in haste without going through proper procedures, achieving financial close, setting work timelines and acquiring land.
“For example, when I took over I discovered that Wapda was paying heavy fines to contractors of the Dasu project as its construction contract was awarded two years back without acquiring land. Within three months I got the survey of the area done and acquired 500 acres of land. Now, the contractors face penalties as they haven’t brought in the needed equipment at the site.
“I also cancelled the contract of a foreign contractor that subcontracted its entire contract to another party against the rules. This is the first (foreign) contract scrapped by Wapda in the last 39 years. We have sent messages to other contractors to mend their ways and have arranged Rs144bn funding from domestic banks. Dasu is scheduled to produce 2,200MW of electricity in 2021 and another 2,200MW in 2024,” Mr Hussain said.
He said he was ensuring that that no future contract was awarded without financial close and a concrete timeline.
“Neelam Jhelum launched 14 years back was scheduled to be completed in four years at a cost of Rs84bn. But since financial close was not achieved and no timelines were decided, the project’s cost has escalated to over Rs500bn (making it one of the most expensive hydropower project in the world).
“Similarly, in case of Tarbela Extension IV, there was no coordinated schedule of work completion among the employer, consultant and contractor. Manufacturing of the main inlet valve (MIV) — a critical equipment to complete intake structure — was pending for two years. The issues have been addressed and Wapda timeline shows that the first 460MW unit would become operational by the end of this year while the remaining two during high water flow season in 2018. Systems have been developed at Wapda that will ensure that no project in future meets this fate,” the chairman claimed.
Published in Dawn, Economic & Business, April 17th, 2017