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Load-shedding and an election

Updated Apr 20, 2017 09:30am

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WHILE the verdict on the Panama Papers case commands the national attention these days, another issue of potential game-changing significance is taking shape beneath the headlines. The return of load-shedding, the emblem of an intense power crisis that the country has been in the grip of for almost a decade now, has cast a shadow over the electoral prospects of the PML-N in 2018.

The elimination of load-shedding was a central plank of the party’s campaign in 2013. Those elections were held under the cloud of 16-hour-long power outages in many areas that were crucial constituencies. The PML-N ran with the promise that they would ‘eliminate’ this problem once and for all.

For a brief while, it looked like the party was on its way to delivering on the promise. It inaugurated its term in office with a historic retirement of the circular debt — that mountain of unpaid bills to private power producers that had choked the power sector. The problem then, as it is now, was not so much a shortage of generation capacity. It was a shortage of funds with which to plug the many financial holes that had riddled our power sector.


Load-shedding is not the result of power shortages as much as it is the result of financial shortages and a governance deficit.


Having retired the entire circular debt in one go, the party then made a promise to the country that this would be the last such exercise. From here on, we were told, the power sector would be reformed and generation capacity added to ensure that it became financially self-sustaining while growing to meet demand at the same time. The details of those reforms were given to the IMF as part of the country’s application for a loan in September 2013, and included privatisation and pricing reform, amongst much else.

Then came the China-Pakistan Economic Corridor (CPEC), that far-reaching enterprise that was recently described by the Planning Commission as “a miraculous happening” in a Tweet. That project was going to add 16,000 megawatts of electricity to the grid, we were told, along with a vast investment in transmission to enable the system to actually carry the augmented megawatts. Now our problems would be solved forever.

With the arrival of CPEC power projects, almost all talk of reforms fell by the wayside. All eggs were now squarely in the CPEC basket and it became nearly impossible to talk to any government minister about the economy without CPEC coming into the conversation. The augmented megawatts would solve all our problems, we were told.

Here is how the game began to shape up after that: get the megawatts installed on a fast-track basis, before 2018. Before the expiration of the government’s term, all the new power projects under the ‘early harvest’ scheme of CPEC should be up and running. Then rev up those turbines at full capacity, and just like that, load-shedding will disappear. Then hit the campaign trail and, at every rally, ask the electorate this question: “Did I not promise to eliminate load-shedding if you give me your vote? Is there load-shedding in your homes now? See! I have eliminated load-shedding, just like I said I would! Now give me your vote one more time, and I will eliminate poverty, unemployment,” and so on.

This was more a political strategy than a power-sector growth plan. The only problem is it had a potentially fatal flaw.

The flaw is this: load-shedding is not the result of power shortages as much as it is the result of financial shortages and a governance deficit. Simply adding more megawatts to an outmoded system that is difficult to keep operational in the best of circumstances only adds more megawatts to the problem. It does not solve the problem.

The way it could work out in reality could be very different. With all projects installed, there could be large technical problems at the outset, just like what happened in the Nandipur power plant, making them difficult to get operational. Second, a shortage of funds could render the scheme inoperative, just like what happened in 2013, leading to plant closures due to fuel shortages, or large accumulation of arrears to private operators, again just like what happened in 2013.

But the largest weakness in the plan is the fact that for three months leading up to the election itself, there will be an interim government. Unless the Panama verdict has upended things, that interim government will come in June and rule till early September, the crucial summer months when heat and monsoon can lay waste to the best-laid plans.

I’m willing to bet the government will do its best to leave behind a massive stockpile of fuel, and massively retire all outstanding payments to private power producers before handing power over to the interim government, because these are the two things that could cause the power sector to choke up at the crucial moment when its smooth functioning will matter the most. Since the handover of power will happen in June, before the fiscal year has closed, the retirement will be reflected in the fiscal deficit figures of the government’s last year, which could blow all targets as a result.

But should a large-scale payment or fuel stock deterioration take place during those crucial months, or an unexpected event like the unusually hot April days that we are currently witnessing and that have cause a massive spike in power demand, load-shedding could still return since the ability of the interim government to effect a large, strategic intervention to keep the turbines turning smoothly will be limited.

If this happens, it could cost the PML-N- heavily in the polls. And that would be the irony of the decade, because their exit from power would mirror almost exactly the circumstances of their arrival into power. All along one had hoped that they had a vision beyond raw megawatts when they promised to ‘eliminate load-shedding’. But it turns out they don’t. Now let’s wait and see how that works out for them.

The writer is a member of staff.

khurram.husain@gmail.com

Twitter: @khurramhusain

Published in Dawn, April 20th, 2017

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The views expressed by this writer and commenters below do not necessarily reflect the views and policies of the Dawn Media Group.



Comments (19) Closed



RAHUL Apr 20, 2017 07:23am

Very rightly said. Power sector reforms needs a very professional and focussed approach, which you seldom see coming from politicians. Fortunately in India the power minister is a professional and with schemes like UDAY the distribution story has got a positive impetus. Modi made a similar promise in his election campaign to electrify 18600 villages before 2019. Anyone can track his government performance by downloading an app called GARV. It is real time project progress report.

K Be Like PK? Apr 20, 2017 07:29am

Author has rightly pointed cpec will bring electricity. Example quaid plant will bring electricity the rate may be 25 re or say subsidized 20 re per unit. The question is the circular debt will rise as no one will be willing to pay such a high price. So it's a financial question.

nuh Apr 20, 2017 07:35am

Zero load-shedding was a political rant. Realistically, over the last four years, the load shedding hours are on decline. Given a healthy GDP growth, this reduction in load shedding hours is a good omen. This year is an extraordinary year due to an early dry hot spell. There is a severe shortage of water in dams to generate hydro-power. There are many hydro power generation projects on way. Big dams always face political resistance all over the world. Starting work on these projects is a big success for this government.

AKB Apr 20, 2017 09:26am

The power shortages can be met with hiring of rental power boats during elections. It will be a win win situation both for winners of elections and voters.

riz Apr 20, 2017 10:36am

you nailed it Khurrum,,, nice read,,

skeptic Apr 20, 2017 10:50am

" The elimination of load-shedding was a central plank of the party’s campaign in 2013." Correction to be read as "The elimination of load-shedding was a central PRANK of the party’s campaign in 2013."

M. Emad Apr 20, 2017 11:42am

Bangladesh Electricity generation capacity 15,000MW.

Khawar saleem aslam Apr 20, 2017 12:39pm

I wish author had included some analysis of projected demand and generation to prove his point. Terming load shedding problems to circular debts is too simplistic. With population growth, increase in GDP and old plants, you need to add power generation; of course with upgrading of the system as well. For eliminating load shedding you need to have spare capacity to account for outages due to some trips or forced shutdowns or weather affects, system maintenance and aging. If you do not have spare capacity only alternate is load shedding.

ZULFI Apr 20, 2017 01:03pm

between an honest consumer and power producers sits 'A' block where Ministry of Water & Power sits

GUEST Apr 20, 2017 01:15pm

Good article

Hasan Apr 20, 2017 02:03pm

I'm a big fan of this Khurram Husain dude. No matter what subject he covers, he endeavours to inform the reader with dispassionate, objective analysis, while maintaining a good writing style and offering his own insight. Mr H - keep up the good work.

Hasan

A Sharma Apr 20, 2017 02:38pm

An Efficient Power Sector needs well versed planning and organisation. There are multiple challenges and it pretty much demands very thorough and professional approach. For instance , power generation is first challenge then having efficient transmission lines to deliver power is another, thirdly cost of generating power must be affordable (that in turn depends on the cost & availability of raw material like coal) so that end user can afford it, finally proper governance & auditing on the part of pvt. discoms, else these pvt. players have a nature of building the nexus with local government & artificially inflating the price, or in worst case populist govt. paying subsidies for inflated bills, further pushing the state in debt.

S. Islam Apr 20, 2017 03:53pm

In the developed countries where there is no load shedding i.e they have plenty of electricity the government and companies producing electricity still advertise,promote and encourage people to save electricity for their own benefit as well as for the climate but here in Pakistan where the production is less than what is required people of the nation waste so much electricity. Shoe and clothing shops open late into the night with bright lights etc. If all unnecessary shops closed early like they do in the devolved countries the country will save more and thus have less shortage while the government needs to carry on creating more ways of producing the electricity with qualified and competent people in the power ministry. It is the responsibility of everyone to work towards this goal.

akram Apr 20, 2017 04:27pm

@M. Emad Pakistan Generation capacity is 20, 000 MW. To double in the near future to 35000 to 40000 MW.

kannan Apr 20, 2017 11:13pm

@akram : Pakistan Installed capacity is 21 K MW. The production is roughly around 12 K MW which is lesser than what Bangladesh produce every day which is 15 K MW.

Read more before you comment.

Marata Apr 20, 2017 11:57pm

Why PML N are not working on the construction of the new dams in the winter season, when they have the idea of the worse load shedding in the summer season,

Irfan Akhtar Apr 21, 2017 07:59pm

Dear Mr. Khurram, Agree with all your points. I also assume government will buy fuel and clear circular debt when people would come to streets but what about these days.

We need to address power issues at many fronts simultaneously: 1. one thing that people miss is use of substandard UPS and Batteries. These backup systems are causing about 20 to 30% power loss. Our batteries are low efficiency, low quality and so are our UPS which cause not only cause failure of our fans and lights but also add large number of harmonics in the system. Has anybody thought about it? 2. LEED certified building codes to be implemented. Our homes, our building, our infrastructure is not energy efficient at all. When are we going to work on that? Our homes/buildings need 20 to 30% more energy than in developed world. 3. Due to lack of net metering and tax subsidies, we are not seeing mushrooming in solar panel installations. I think it would help a lot.

Irfan Akhtar Apr 21, 2017 08:05pm
  1. Losses. I have personally suggested systems for technical losses evaluation at where they are happening. I am not talking about theft, thats separate issue. technically moving to 33 KV systems from 11 KV would help a lot. Start this project in phases and in larger cities initially. Its about time. Moreover, think about installation of power factor improvement SVC devices in the network. 5. Finally, when you have installed capacity not producing at rated power, then its mismanagement or corruption. I said corruption because implementing procedures and policies to run plants efficiently and reliably would been lesser commissions as compared to new projects. Upgrade equipment.
Kamran Apr 22, 2017 02:20pm

They know all this about idle generation capacity and finances to support. The problem there is no money to make on reforms. Money can be made by initiating new projects.