Power Policy for Pakistan - Issues and Options

By Engr. Khalid Pervez

SYNOPSIS:
By its very nature, the electric power sector development is a continual and cost intensive undertaking
and must be strategically interwoven with both short term and long term socio-economic development
policies of a country.

Huge investments have been made in Pakistan in power development by the public sector as well as
through the participation of private sector. Nevertheless, the power development exercise is noted to
be marred with misplaced priorities, lack of cohesion with economic development policies, absence of
integrated efforts of various agencies active in power and energy, lack of comprehensiveness of
plans, ill defined targets and strategies of energy management, etc.

This almost chaotic situation is manifested by the state of affairs in the power sector: very high
electricity cost; frequent outages and load shedding; non availability of electricity to a large section of
population, etc.

The situation calls for overhauling of the process of policy making and its implementation. This paper
endeavors to review the prevalent practice of the government in respect of policy formulation and
implementation, debates on the options of power generation and participation of private sector and
presents the salient features of a comprehensive approach.

1. Earlier Developments

Pakistan started fairly well with its power sector development. The small utility companies
that Pakistan inherited on partition were able to meet the power requirements of the pre-
partition era. The creation of Pakistan resulting into large scale migration and immediate
boost in the trade and allied commercial activities set new and much increased power
requirements.

The then governments realized the complexity of the issue and in the year 1958 created a
single body, namely Water and Power Development Authority (WAPDA) to plan, develop
and commission water resources and power sector encompassing generation, transmission
and distribution over the entire country (including the then East Pakistan), excluding Karachi.

The Karachi Electric Supply Corporation (KESC) being on sound technical and financial
footings was expected to deal on its own with the unique and pressing requirements of an
exploding metropolis, also the then capital of the country.

Creation of WAPDA could indeed be regarded as a milestone in the water and power sector
developments of the country. WAPDA planned and implemented the following major
undertakings in the power sector:

- Construction of large multipurpose dams such as Warsak, Mangla and Tarbela.

- Construction of thermal power plants, such as Kot Addu, Jamshoro, etc.
- Expansion of transmission and distribution network.

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In parallel developments, Pakistan also made substantial headway in nuclear energy and in
mid-sixties commissioned KANUPP as its 1st nuclear based power plant to deliver 125MW to
KESC network. The plant was to receive a new life through indigenous efforts in the years to
follow.

Pakistan’s power sector is also noted to have timely undertaken the following key initiatives
and ventures:

- Private sector participation leading to establishment of HUBCO.

- Construction of 500kV transmission system.
- Establishment of National Transmission & Dispatch Centre [NTDC] at Islamabad.

Barring the nuclear undertakings which were primarily meant for indigenous capability
development for peaceful purposes (agriculture, medicinal and power generation
applications), the power sector developments that took place up to the late 70s were based
on well thought of plans catering to both short term and long term needs of the country.

Subsequent years witnessed adhocism and self-serving hasty prescriptions resulting in a

host of shortcomings and problems, crippling the power sector as a whole.

2. The Present Scenario

The present status of power sector encompassing generation, transmission and distribution
could be viewed from different perspective such utility operation and management, energy
pricing, quality of power supply, captive and small power producers, etc. All these subjects
must be addressed to in the power policy framework.

The present status of policy making process and relevant issues is noted to be characterized
by the following.

• In real terms, no mechanism and framework of policy making exists. [The highly
controversial quick-hit Power Policy 1994 too was the brainchild of a few individuals
and it received strong criticism of professional bodies including IEEEP]

• Apart from WAPDA & KESC, a number of governmental organizations are directly or
indirectly involved in power sector planning and development. Some of these
organizations are the following:

- Planning Commission
- Ministry of Water & Power;
- Private Power & Infrastructure Board;
- Renewable Energy Development Cell
- Solar Energy Development Cell, etc.

There is no single agency responsible for integration of planning and development

process of various organizations named above and to blend them and prioritize them
in accordance with the short term and long term socio-economic policies of the
country.

• Status of coal exploration and long term availability of gas for power generation
remain unclear.

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• Renewable and alternate energy sources still don’t have a place in mainstream
debates.

• Construction of large hydroelectric plants keeps on becoming headlines, but serious

and concerted efforts are not put in place to arrive at broad based technically sound
solutions. Mini and micro hydel schemes also couldn’t take-off due to lack of support
and patronage by the respective government quarters.

• Whether or not nuclear plants have a place in Pakistan’s future power sector
scenario is any body’s guess.

• The rationale, impediments and time frame of privatization of utilities are not debated
by the government at any well organized stake-holder based forums.

• Electricity is very expensive and there are severe anomalies in electricity tariffs.

The above presentation clearly indicates an essential need to undertake a national power
policy formulation and implementation process which should be comprehensive in nature,
and very well interwoven with the long term socio-economic policies of the country.

3. Elements of Power Policy Formulation

There are various approaches to undertake the process of power policy formulation. The
discrete steps and elements presented here, as an example, are based on the practice
adopted by South Africa when it commenced its major policy review in the year 1994.

The aims and objectives of the policy makers were:

- to make government’s approach to energy policy formulation more

transparent;
- to build public confidence in the policy formulation process;
- to clarify accountability and organizational roles through the process of policy
formulation;
- to integrate various government policy process, and
- to communicate policy in a manner which is clear and understandable for all.

The discrete steps followed in the process were the following.

Step # 1 : The process started with the drafting of an Energy Policy Discussion
Document by a multidisciplinary team of experts. This document
defined more than 100 major policy issues. The Document prepared in
about a year served as a resource for policy consultation process and
invited written comments of interested parties and stake-holders.

Step # 2 Holding of a number of workshops with the stake-holders.

Step # 3 A team of individuals was appointed to develop the first draft Policy
document for discussion at the National Energy Policy Summit. The
draft incorporated the written comments and outcome of workshops.

An editorial committee consisting of non-stockholders was also formed

to review and finalize the first draft.

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 Step # 4 Discussion of draft at the National Energy Policy Summit and its
adoption as a National Policy after the agreed amendments.

The process could indeed be adopted in Pakistan too on the same pattern. It would pass
through a phase of normal obstacles of consensus development, conflict of interest, etc., but
if backed by a will to do, would indeed meet with success.

4. Conclusion

Pakistan has invested exorbitant money in the power sector; still its huge section of
population is deprived of electricity. And those who have it pay a very high price and still
invest in standby power sources.

Then there are those who were forced to opt for captive generation, thus adding to the foes
of utilities. The situation calls for immediate initiation of the process of energy policy
formulation. The more the delays, the bigger the problems.

About the author: Engr. Khalid Pervez did his BE in Electrical Engineering from the NED
in 1971 and his MS from USA in 1981. He taught electrical engineering at NED for 15 years
including 5 years as Associate Professor. For the last 17 years he has been in consulting
and project management and heads his consulting house, KP & Associates. He has
contributed more than a dozen of technical papers in seminars and symposia. He can be
reached at kpervez@cyber.net.pk

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