If there is a single lesson of the ongoing Russia-Ukraine war for us, it is that self-reliance in energy should become Pakistan’s number one goal from this point forward.
This eight-month yet unfinished war will keep the international energy trade severely disrupted in the foreseeable future. The foremost objective of western countries is to take every punitive action that blocks Russia’s crude oil and gas exports. On the one hand, they have imposed a price cap on Russia’s crude oil exports, while on the other, Europe is trying to replace its gas imports from Russia with other international sources of supply.
The ongoing energy trade war has disrupted the entire world economy, with less developed countries of Asia and Africa facing the brunt. We are left at the mercy of the LNG suppliers who are not too willing to sell it to us even at exorbitantly high rates, thus making a massive shortage in the coming winter nearly certain.
Although there is very little recourse available to Pakistan in the short term, it can improve its energy security, at least for the medium term (three to five years), by thinking strategically. The thrust of this article is to determine what measures Pakistan can take to improve its energy self-reliance under this and similar future threats.
Although there is very little recourse available to Pakistan in the short term, it can improve its energy security in the medium term by thinking strategically
As Russia’s oil and gas exports get seriously jeopardised, other oil and gas-producing nations are taking steps to fill the void. For example, Qatar is undertaking a major expansion in its natural gas production and building new LNG export terminals simultaneously.
Further, to hedge its future bets, it has signed long-term contracts for selling LNG not just with the Western markets but also with Asian countries. One can only hope that Pakistan is actively engaged with Qatar at this important juncture to secure, if not its short-term needs, at least the long-term supply of LNG otherwise this train too might leave the station.
Russia is seeking alternate markets for its crude oil exports and is already selling more and more of it to India and China. Much as Pakistan would like to benefit from Russia’s predicament and import its crude, which sells at a steep discount to the world price, alas it may not be possible due largely to the pressure from the West. China trades with whoever it likes with no concern about the West’s view, and India too of late, has started doing the same as the recent rise in its trade with Russia indicates.
There are two key themes regarding securing our long-term energy future and its economic future — exploiting indigenous resources and relying on alternate energy sources: wind and solar power.
First, the indigenous resources. The building of large hydropower projects serves the dual purpose of regulating the flow of water and producing electricity. But, these long-gestation projects — often taking eight to 10 years — are not ideal from a schedule and cost standpoint.
The other indigenous energy source is the Thar coalfield, and the government has already given a strong policy direction for its speedy exploitation. It is hoped that state-of-the-art technology will be applied so that the environment remains clean and global warming effects are fully mitigated while using indigenous coal, which is known to be of poor quality.
Second, the case for alternate and renewable energy sources — solar and wind power — which have the drawback that their output is available on an intermittent basis. In contrast, the demand for power is constant.
Due to its lesser intermittency, CSP (Concentrated Solar Power) technology should be seriously looked into. Also, Battery Energy Storage Solutions (BESS) have to be adopted on a grand scale. BESS has two other advantages in addition to overcoming the intermittency of supply.
First, it helps to regulate the power grid, thus improving its safety. Second, it is a storage medium that stores electricity from whichever source it is produced and supplies in times of power shortage — quite similar to the UPS (uninterruptable power supply) in our homes.
What strategy should be put in place to improve Pakistan’s energy self-reliance? Firstly, the effects of a rapid increase in new Variable Renewable Energy (VRE) projects on the overall system should be studied thoroughly to avoid unexpected system faults. BESS technology can enhance power system flexibility and enable high levels of renewable energy integration as the share of VRE rises in Pakistan’s total power generation mix.
Being a new technology, BESS needs to be studied thoroughly before undertaking its large-scale adoption. There are several options relating to where it should be installed in the system — transmission network, distribution network near load centres, co-located with VRE generators or a combination thereof.
Newer energy technologies, therefore, require a scientific and analytical mindset among our energy planners, decision-makers and front-line energy organisations.
Combined with energy storage solutions, wind and solar technologies are the best way to reduce long-term dependence on external energy fuels: oil and gas. This is also where the world is headed, and Pakistan needs to follow the same path.
However, their large-scale adoption has its own challenges which need to be studied and addressed. The old-school engineers and scientists that are our planners and decision-makers are not fully well-versed in how to overcome these challenges. A new, modern approach to electricity system planning is needed for which highly trained scientists, engineers and practitioners will have to be engaged from wherever they are available.
If we start treating the threat to our energy security as a challenge to national security, and take educated steps from now, it may be possible to realign our energy sector with the cutting-edge developments that are taking place in the world in the field of energy.
The writer is a former Group Director of Energy at the Islamic Development Bank and works as a consultant on sustainable energy-related matters.
Published in Dawn, The Business and Finance Weekly, October 17th, 2022