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Saturday, April 13, 2024

Pak-Iran: energy sector performance and wind power project

News Analysis |

By the end of the financial year 2017, it can be said that  Pakistan’s power and energy sector will see tremendous improvements in the years to come. Such improvements are tending to normalize the energy crisis hitting the economy in the near future.

In the separate episode of events, it is observed that Pakistan’s energy productions are expanding gradually and by the year 2019 much of the energy crisis is expected to be abated.

According to the official sources, it is said that Pakistan has witnessed a 79% of total increase in the oil and gas production sector in the last four years of the current government.

Read more: Why Pakistan’s energy policy will create an environmental hazard?

Pakistan has already been fulfilling its large part of fuel and energy from the Iranian imports.

However, this is much higher when contrasted with the corresponding years of the previous governments. There have been 98 new oil and gas discoveries with a success rate of 40% in the sitting government rule while only 39 new oil and gas discoveries were made in the years of previous government.

Also, surprisingly, the bulk investment of Rs 836 billion has been poured in the Energy and Production sector over the past four years which has triggered the exploration activities.

Pakistan has already been fulfilling its large part of fuel and energy from the Iranian imports. In a recent development, the government has signed a long-awaited power project with the neighbor, Iran.

An Iranian firm has been given a green signal to set up its wind power plant in the region of Sindh, which will add 49.5 megawatts in the grid system.

Read more: Depleting gas reserves of Pakistan: Is Synthetic Gas the only option?

The wind power project

NEPRA on Monday announced that it has issued the license to Iran-Pak Wind Power (Pvt) Limited (IPWPPL) for a period of 20 years.

The power project is expected to be located in the wind corridor of Jhimpir, District Thatta and will begin its commercial production by June 30, 2019.

In the aftermath of dissolving the agreement between the Sindh Engro Coal Mining Company and Lucky Cement, the government has opened the way for the power developers, who are interested in setting up the coal-based power projects, to get in to deal with any developers of coal mining in Thar, Sindh.

The new company Lucky Electric Power Company Limited (LEPCL) is all set to produce the 660 MW of electricity from its power plant near Port Qasim.

The new setup of Lucky Power Plant, will not only be the first plant to produce energy from the local coal but can also prove to be a helpful chain in exporting the coal from Port Qasim.

Read more: Is Pakistan making a conscious choice: removing energy crisis vs environmental disaster

This project, in particular, would cater to the energy needs of the metropolitan city of Karachi, reducing its dependency on the electricity share supplied from the Federal system.

However, in a wider perspective, the reliance on the external providers is not without its own pros and cons. With the immediate benefits gained from the increased electricity production and less burden on the limited monetary funds, these can be allocated to bring prosperity in other sectors.

But the outflow of profits to the outer investors means that the government is missing out on chances to collect that money and using it for further development.

Furthermore, it also implies that external dependency for meeting energy need means that government is compromising and blocking all means to gain self-dependency at least in the near future. More focus should be directed towards gaining self-dependency if the country wants to get out of the circle of debts and loans.