FOR almost a quarter of a century, Pakistan’s dependence on imported oil for power generation has been growing, placing an increasingly unbearable strain on our balance of payments, as well as driving up the cost of electricity.
Successive governments have made attempts to break out of oil either by encouraging international investment in domestic coal, particularly in Thar, or by trying to locate resources for more investment in hydroelectric projects which carry very high upfront costs.
Till today, those efforts have not borne any fruit. Nobody denies there is a dire situation here, one that has been decades in the making.
This is the story the government invokes to justify a big push for coal-fired power plants in the country, with a total of almost 6,000MW in the pipeline, representing more than half of all the generation capacity coming under the CPEC framework.
Even five years ago, it was possible to argue that we in Pakistan have no choice but to walk down this road. Back then, there were few alternatives available, and most of the world’s power was generated through coal. It was possible to argue that our carbon footprint was very low and our contribution to global greenhouse gas emissions negligible.
Today, those arguments are difficult to accept. Anybody who thinks environmental worries regarding coal are bucolic concerns compared to the power requirements of our cities and industry is invited to take a walk through the respiratory wards of Lahore’s Mayo Hospital, to use one example, when the smog is in full swing to discover otherwise.
The supposedly cheaper price of coal power is also not looking any more attractive with each passing year as the price of renewable energy plunges.
For instance, some of the coal tariffs operative in the country today are as high as 11.1 cents, whereas solar is now being contracted around the world at below 2 cents in some cases.
The problem is that our policy community is working within a highly outmoded framework that was put in place more than a quarter of a century ago.
This was the system of upfront tariffs, capacity charges, sovereign guarantees and fuel supply agreements that we call the Independent Private Power Policy.
The world of power generation and distribution has moved on since then.
Today, point of consumption generation and net metering are the norm, and old concepts of baseload capacity are being left behind.
The rush into coal now appears deeply misguided, and although it is difficult at this point to expect a change of course, it is still possible to argue that from here onwards coal-fired generation capacity should be capped, and the focus of the forthcoming power policy should shift towards finding ways to bring to Pakistan the renewable revolution that is currently sweeping the world.
Published in Dawn, February 7th, 2018
