A look at Pakistan’s Energy Profile

Engineering Post Report

Over the years, Government of Pakistan has announced different policies to ensure the smooth supply of energy  to the general public  and to boost national economic growth.

These policies include “The National Power Policy 2013″, The Power Generation Policy 2015” and “Alternative and Renewable Energy Policy 2019”, according to the information gathered from the official sources concerned.

The National Power Policy 2013 aimed to develop an efficient and consumer- centric  power generation, transmission and distribution  system that could  meet the growing  needs of the people  and also boot the economy of the  country in a sustainable and affordable manner. The main targets  included complete  elimination of load shedding, decreasing the average cost of electricity  generation, decrease in the transmission and distribution losses, increase the revenue collection and a reduction  in the time required  for decision making  at the ministry level or other related departments.

In 2015, the Government introduced ” Power Generation Policy 2015″ in order to facilitate private investment in the power sector. The policy offered incentives  to the to the private sector  to set new  power generation projects as well as  invest in  public sector  power generation  projects in a different phases of development.

In 2019, the  alternative and Renewable  Energy Policy was introduced to assist and  promote the development of renewable  resources of the country. The main objective of the policy was to provide  supportive environment for renewable power projects, increase the share of green  energy capacity  to 20 per cent by 2025 and 30 per cent by 2030 through attracting  private capital in the area of green energy.

The official  sources further stated that the country’s energy sector is  prone to certain challenges. For instance, the problem of circular debt in the energy sector is a long awaited issue. Successive governments have strived hard  to bring circular debt down but the issue somehow largely remained controlled. In FY2013, circular debt was  around Rs 450 billion which increased to Rs 1148 billion in 2018. According to the data of the Central Power Purchasing Authority (CPPA), circular debt  stood at Rs 2467 billion in March 2022. This implies  that circular  debt  is equivalent  to 3.8 per cent of Pakistan’s Gross Domestic Product (GDP)and  represented  5.6 per cent of Pakistan Government debt.  Growing at at the current pace and if it is continued to allowed to grow  unaddressed, it is estimated to reach Rs 4 trillion by 2025, demanding the urgency of reforms in the power sector.