Power sector development in Pakistan

Letter of Transmittal

Date: October 30th, 2009 Sir Rafique Instructor, Economic development, KUBS Dear Sir, With reference to the topic assigned, this report is being submitted to you on October 31st 2009, as requested. It is based on the Power sector development. The report has been drafted to provide a perspective on the past considerations and current scenario of power development in Pakistan. The report includes the supply and demand of the electricity and methods of electricity generation and their respective sectorial distribution. The report also includes the expansion plan of government regarding the power development in Pakistan. We have tried our level best to use the basic concepts taught in this course. Hope you enjoy viewing our work and it is satisfactory. Thank You

Sincerely, Shazhad Rafique # 25 Sohaib Akram # 13

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Power sector development in Pakistan

Table of contents

S.NO.

PARTICULARS

PAGE NO.

1

Introduction

3
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2 3 4

Overview of electricity sector Installed generation capacity Supply sources of electricity
1.WAPDA 2.KESC 3.Nuclear Energy 4.Independent power projects

4 6 7 7 11 11 12 14 15 17 19 21 21

5 6 7 8 9 10

Transmission &Distribution Consumption of electricity Growth in consumers Village electrification Expansion of generating capacities conclusion

INTRODUCTION
Pakistan’s energy infrastructure is under-developed, insufficient and poorly managed. Presently Pakistan has been facing severe energy crisis. Despite strong economic growth and rising energy demand during the past decade, no serious efforts have been made to install new capacity of generation. Consequently, the demand exceeds supply and hence load-shedding is a common phenomenon through power shutdown. Pakistan needs around 14,000 to 15,000 MW electricity per day, and the demand is likely rise to approximately to 20,000 MW per day by 2010. Presently, it can produce about 11,500 MW per day
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and there is a shortfall of about 3000 to 4000 MW per day. This shortage is badly affecting industry, commerce, daily life and posing risks to the economic growth. The overall requirement of Pakistan is expected to be about 80 MTOE in 2010, up by 50% from the 54 MTOE of the current year. During the past 25 years energy supply in Pakistan has been increased by about 40 times but still the demand outstrips supply. With the increase in economic activities, per capita energy consumption had also been increased. Industrialization, growth in agriculture and services sectors, urbanization, rising per capita income and rural electrification has resulted in a phenomenal rise in energy demand (NBP, 2008). Inefficient use of energy and its wastages has further widened the demand-supply gap and exerts strong pressure on the energy resources in the country. The annual growth of primary energy supply increased from 3.17% to 4.3% during 1997-98 to 2006-07. The share of natural gas reached to 48.5%, followed by oil 30.0%, hydro electricity 12.6%, coal 7.3%, nuclear electricity 0.9%, LPG 0.5% and imported electricity by 0.1% during the year 2006-07. In Pakistan the current energy crisis stems from the decline in hydro sources of energy and over reliance on the expansive source of electricity. Presently, oil-based thermal plants accounts for 68% of generating capacity, hydroelectric plants for 30% and nuclear plants for only 2% This has led to a huge generation costs, which in turn adversely affect the economy over the past eight years. Rise in the oil prices pushing electricity tariff very high. As a result, manufacturing costs and inflation are at the rising trend, export competitiveness is eroded and the pressure on the balance of payments is increasing. These factors adversely affect the present growth trajectory of the economy .

OVERVIEW OF ELECTRICITY SECTOR IN PAKISTAN
At the time of independence in 1947, the power generation capacity of Pakistan was only 60 MW for a population of 31.5 million, with a per capita consumption of 4.5 units. However, the power sector gained momentum in
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1970, and the installed capacity rose from 636 MW in 1970 to 1331 MW in 1975. In 1980, the system capacity touched 3000 MW, and thereafter it rapidly grew to over 8000 MW by 1990–1991 (Government of Pakistan, 2008). At present, electricity demand is 13,021 MW, which is expected to increase in the coming years. Responsibility for the generation and supply of electricity rests with two utilities—the Pakistan Water and Power Development Authority (WAPDA) and the Karachi Electricity Supply Corporation (KESC).WAPDA supplies electricity throughout the country while KESC is responsible for supplying electricity to Karachi and its adjoining areas. The Pakistan Atomic Energy Commission owns nuclear power plants, which are connected to WAPDA and KESC networks. The Independent Power Plants (IPPs) are connected to the national grids at various locations. The total installed generation capacity is around 19,420 MW and the customer base is about 17.73 million in 2007–2008 (Government of Pakistan, 2008). The current installed capacity of electricity is about 19,420 MW. During the year 2006–2007, the power system generated 98,213 million kWh of electricity (Table 6) of which 64.3 per cent comes from thermal plants, while hydroelectricity and nuclear power account for 33.4 and 2.4 per cent, respectively. Pakistan’s total generation capacity has increased rapidly due to the establishment of IPPs; this almost eliminated the power shortage in the 1990s. The supply of hydroelectricity is season dependent and decreases by about 3000–4000 MW when the water level in the dams gets low during winter. The effective generating capacity of WAPDA’s power plants has decreased slightly. In the past several years, the installed capacity has been insufficient to meet the demand. Current supply is estimated at 15,055 MW against demand of more than 17,600 MW.A deficit of 2500 MW was recorded through load shedding, which reduced the industrial growth and adversely affected the economy. Many villages do not enjoy access to electricity, and only 60 per cent of the population are connected to the national grid. During the period 1970–2000, the industrial sector consumed 35 percent of electricity, followed by households (33 per cent), agriculture sector (17 per cent), 8 per cent by bulk and the commercial sector by 6 per cent. However, during 2001–2006, the electricity consumption of households dramatically increased to 47 per cent. During the same period, the industrial and agriculture sectors consumption reduced to 33 and 11 per cent, respectively. Commercial sector consumption remained at 6 per cent while bulk share in consumption reduced to 6 per cent. Similarly, during 2006–2007, household electricity consumption remained dominant (46 per cent), followed by industrial sector (29 per cent), agriculture sector (11 per cent), commercial sector (7 per cent), bulk supplies (6 per cent) and street lights (1 per cent) (Hydrocarbon Development Institute of Pakistan, 2007). Thus, the huge increase in household consumption of electricity is the major reason for the
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demand–supply gap. The total installed power generation capacity is insufficient to meet the growing needs of the country and has hit the economy badly. The growing electricity demand–supply gap has forced the authorities to resort to load shedding for very long duration. This has adversely affected the public, businesses and trading communities. To tackle the power crisis, the government has to come up with mega hydroelectric projects and encourage domestic and foreign investors to invest in the energy sector and extend and improve the nuclear power generation. Installed Capacity of Electricity by source

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Sectorial Consumption of Electricity from 1970-2000

INSTALLED GENERATION CAPACITY
In 1947 the total installed generation capacity, hydro and thermal was 70 MW, 60 MW in now WAPDA system and 10 MW in Karachi. It is 19754 MW in 2009, hydro 6555 MW; thermal 13119 MW which includes conventional steam and combined cycle power plants and nuclear 462 MW owner Pakistan atomic energy commission. The total installed generation capacity of WAPDA in 2008-09 is 11,454 MW, including 6,555 Hydel and 4,899 Thermal. Other sources of generation are KESC 1,884 MW and IPPs 5,954 MW. Total Installed Generation Capacity(MW) Power Company Installed Capacity(20082009) 1. 2. 3. 4. 5. 6. WAPDA Hydel Thermal KESC IPPs Nuclear 11,454 6,555 4,899 1,884 5,954 462 Share(%)

58 57.2 (share in WAPDA System) 42.8 (share in WAPDA System) 9.5 30.1 2.3
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Total

19,754

100.0

Source: Hydrocarbon Development Institute of Pakistan

SUPPLY SOURCES OF ELECTRICITY
1.WAPDA
The installed capacity of PEPCO system is 18,019 MW as of March 2009 with hydro 6555 MW and thermal 11,464 MW. The hydropower capacity accounts for 36.38 percent and thermal 63.62 percent. Out of 11,464 MW of thermal power, 4899 MW is owned by ex-WAPDA GENCOs 285 MW by rental, 325 by PAEC and 5954 by IPPs. Addition in Installed Generation Capacity in Pakistan (Megawatt) Year Hydro Share(%) Thermal Share(%) Total 1959-63 1964-68 1969-73 1974-78 1979-83 1984-88 1989-93 1994-98 267 300 100 900 980 350 864 1064 67.0 45.4 51.0 67.2 74.3 22.0 32.7 31.2 130 361 96 438 339 1245 1782 2350 33.0 54.6 49.0 32.8 25.7 78.0 67.3 68.8 397 661 196 1338 1319 1595 2646 3414

Electricity Generation by WAPDA(GWh) Year 1998-99 1999-00 2000-01 2001-02 Hydro 22,448 19,288 17,259 19,056 Share(%) 41.8 34.3 29.5 31.3 Thermal 31,235 36,585 41,196 41,804 Share(%) 58.2 65.5 70.5 68.7 Total 53,683 55,873 58,455 60,860
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2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 July-March 2007-08 2008-09

22,350 27,477 25,671 30,855 31,942 28,667

34.9 39.8 34.9 37.5 36.4 33.23

41,690 41,617 47,849 51,370 55,895 57,602

65.1 60.2 65 62.5 63.6 66.77

64,064 69,094 73,520 82,225 87,837 86,269

21,606 20,665

33.5 33.7

42,963 40,653

66.5 66.3

64,569 61,318

Source: PEPCO

WAPDA THERMAL ELECTRICITY GENERATION WAPDA's Thermal Power Generation is mainly based on generation of power from its Steam Turbo-Generators, Gas Turbines (simple as well as Combined Cycle Units) installed at different Power Stations located in Sindh, Punjab and Balochistan provinces. Indigenous Gas & Coal is the main fuel whereas Furnace oil and HSD are also used as alternative fuel. The total installed capacity is 4664 MW. Thermal power plants generated a total of 21.593 Billion units (kwh) of energy during the year 2006-07. The energy generated during 2008 was 62% on gas,37% on furnace oil and 1% on coal. As per Government of Pakistan policy all thermal power generation has been restructured and four corporative companies namely Jamshoro Power Generation Company Limited (GENCO-1) head quarter at Jamshoro district Dadu near Hyderabad Sindh, Central Power Generation Company Limited (GENCO-2) head quarter at Guddu district Jacobabad Sindh and Northern Power Generation Company Limited (GENCO-3) head quarters at Muzaffargarh and Lakhra Power Generation Company Limited (GENCO-IV) at Khanote (Sindh) have been formed and registered. Functioning of GENCO’s has commenced.
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WAPDA HYDEL ELECTRICITY GENERATION As a consequence of partition of the Indo-Pakistan Sub-Continent in 1947, India and Pakistan became two independent sovereign states. Hydel generation capacity of only 10.7 MW (9.6 MW - Malakand Power Station & 1.1 MW - Renala Power Station) existed in the territory of Pakistan. With the passage of time, new Hydel Power Projects of Small and Medium capacities were commissioned including the first water storage dam and power house at Warsak due to which country's Hydel capability raised to about 267 MW up till 1963. The Irrigation System which existed at the time of partition in 1947 was divided between the two countries without any regards to the irrigation boundaries which resulted in an international water dispute which was finally resolved by signing of the Indus Water Treaty in 1960 under the aegis of World Bank. The Treaty assigned three Eastern rivers (Ravi, Beas and Sutlej) to India and three Western rivers (Indus, Jhelum & Chenab) to Pakistan. It also provided construction of replacement works called Indus Basin Projects (IBP) to compensate for perpetual loss of Eastern rivers' water. The works proposed under the Treaty included two multipurpose dams i.e. Mangla Dam on Jhelum river and Tarbela Dam on Indus river having the provision of power generation. These were commissioned in 1967 & 1977 respectively. However, their capacities were subsequently extended in different phases HYDEL GENERATION CAPACITY The total capacity of 13 No. Hydel Stations as of today is 6444 MW which is 35.88% of total installed generation capacity of WAPDA. During 2008~2009, aggregate energy sharing during the year was 33.07%. SEASONAL VARIATIONS OF HYDEL GENERATION The seasonal variations of reservoir levels and consequent reduction in Power outputs of storage type hydel projects in Pakistan are very pronounced. Tarbela with maximum head of 450 ft. experiences variation of 181 ft. while Mangla has 162 ft. variation against the maximum head of 360 ft. The lean flow period of Tarbela reservoir is from November to June when the Capability reduces to as low as about 1884 MW against the maximum of 3714 MW during high head period i.e. August to September (15% permissible overloading on Units 1~10). Lean flow period of Mangla reservoir is observed from October to March when the minimum generating capability is 496 MW. The capability rises to as high as 1150 MW during 'high head' period (15% permissible overloading).

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In all, WAPDA's Hydel generating capability varies between the two extremities of 3506 MW and 6750 MW over the cycle of a year.

SALIENT FEATURES OF WAPDA HYDEL STATIONS
Station Water Way (River/Canal) Indus (Reservoir) Units No. Capacity of Unit (MW) 175 175 175 432 432 Total 290 290 290 290 290 Total 100 100 100 100 100 Total 40.0 41.48 Total 23 23 23 23 23 Total 11.0 5.0 4.6 6.75 4.4 0.22 Installed Capacity (MW) 700 700 350 432 1296 3478 290 290 290 290 290 1450 400 200 200 100 100 1000 160 83 243 23 46 46 23 46 184 22.0 20.0 13.8 13.5 13.2 1.1 Date of Commissioning Jul. 1977 Dec. 1982 Apr. 1985 Feb. 1993 Nov.1992 July. 2003 Aug. 2003 Oct. 2003 Dec. 2003 April. 2004

Tarbela

1~4 5~8 9~10 11 12~14 1 2 3 4 5

Barotha

Indus (D/S Tarbela)

Mangla

Jhelum (Reservoir)

1~4 5~6 7~8 9 10 1~4 5~6 1 2~3 4~5 6 7~8 1~2 1~4 1~3 1~2 1~3 1~5

1967 - 1969 Mar. 1974 Apr. 1981 Sep. 1993 Jul. 1994 Jul. 1960 Mar. 1981 Jun. 2001 Apr. 2001 Mar. 2001 Feb. 2001 Dec. 2000 Jul. 1952 Dec.1952 Mar. 1963 Jan. 1961 Aug. 1959 Mar. 1925

Warsak

Kabul (Reservoir) Chashma (Barrage)

Chashma

Rasul Dargai Nandipur Shadiwal Chichoki Renala

Upper Jhelum Canal from River Jhelum Swat canal from River Swat Upper Chenab Canal from River Chenab Upper Jhelum Canal from River Jhelum Upper Chenab Canal from River Chenab Lower Bari Doab Canal from Balloki Headworks on Ravi

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Kachkot Canal from River Kurram Ludko 1~4 1~2 3~4 1.0 0.3 0.2 Total 4.0 0.6 0.4 1.0 Feb. 1958 1975 1982

K/Garhi Chitral

2.KARACHI ELECTRIC SUPPLY COMPANY (KESC):
KESC fleet has 1890 MWs of installed capacity to cater to the city load requirement. The main generation units consisting of Bin Qasim Power Station, Korangi Thermal Power Station, Site Gas Turbines and Korangi Gas Turbines, with a new power plant at Korangi (Combined Cycle Power Plant).Presently the situation is as under S. No. 1 Name of Power Plant Location Available Capacity (MW)
1021

Bin Qasim Power Station

Port Qasim Industrial Area

2

Korangi Thermal Power Station

Korangi Creek

55

3 4 5

GEJB- 1 GEJB- 2

SITE, Karachi Korangi Industrial Area Korangi Creek

80 35

Combined Cycle Power Station

160

GRAND TOTAL =1351

3.NUCLEAR ENERGY:
Pakistan Atomic Energy Commission (PAEC) is responsible for the planning, construction and operation of nuclear power plants in the country. Presently, two nuclear power plants; Karachi Nuclear Power Plant (K-1) and Chashma Nuclear Power Plant unit-1 (C-1) are operational, while construction of a third plant, Chashma Nuclear Power Plant unit-2 (C-2), is in progress. K1, has

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been in commercial operation since 1971. After completing its design life of 30 years, K-1 is operating on extended life at 90 MWe. K-1 generated 317 million kWh of electricity during the period July-March 2008-09, raising its life-time generation to 12.21 billion kWh. C-1, a PWR type plant with a gross capacity of 325 MWe, and has been in commercial operation since September 2000. C-1 generated 602 million kWh of electricity during July-March 2008-09, raising its lifetime generation to 16.86 billion kWh. The construction and installation activities of C-2 are in progress as per schedule. The commercial operation of C-2 is expected in 2011. In Pakistan, nuclear power makes a small contribution to total energy production and requirements, supplying only 2.34% of the country's electricity. Total generating capacity is 20 GWe and in 2006, 98 billion kWh gross was produced, 37% of it from gas, 29% from oil. Its first nuclear power reactor is a small (125 MWe) Canadian pressurized heavy water reactor (PHWR) which started up in 1971 and which is under international safeguards - KANUPP near Karachi, which is operated at reduced power. The second unit is Chashma-1 in Punjab, a 325 MWe (300 MWe net) pressurised water reactor (PWR) supplied by China's CNNC under safeguards. The main part of the plant was designed by Shanghai Nuclear Engineering Research and Design Institute (SNERDI), based on Qinshan-1. It started up in May 2000 and is also known as CHASNUPP-1.Construction of its twin, Chashma-2, started in December 2005. It is reported to cost PKR 51.46 billion (US$ 860 million, with $350 million of this financed by China). A safeguards agreement with IAEA was signed in 2006 and grid connection is expected in 2011. Reacto r Typ e MW e net 125 300 300 Construct ion start Commer cial operatio n 12/72 6/00 2011 Plann ed close

Karach i Chash ma 1 Chash ma 2 Total

PHW R PWR PWR

1966 1993 2005

425 operating
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5. INDEPENDENT POWER PROJECTS:
The 17 largest independent power producers in Pakistan all operate thermal generating plants only . The two largest privately owned power producers are the HUB Company (HUBCO) and the Kot Addu Power Company (KAPCO). HUBCO belongs to a consortium formed by National Power (Great Britain), Xenal (Saudi Arabia) and Mitsui Corporation (Japan) and possesses just under 1,300 MW of generating capacity. KAPCO, with more than 1,600 MW of power generating capacity, was privatized in 1996 and now belongs to the British enterprise National Power. Between 1994 and 1997, 19 IPP projects amounting to an overall capacity of 3,158 MW and a total investment volume of some US$ 4 billion were awarded competitive bidding contracts. By the end of March 2003, 2,728 MW of the total had already been installed. The power-producing volume was so large that the Pakistani electricity market began to exhibit intermittent overcapacities. The city of Karachi receives all its electricity from KESC, while WAPDA serves the rest of the country. In the medium to long term, though, the sale of electricity is also supposed to be liberalized. Detail of the IPPs Projects commissioned and under commercial operations is as under
Sr. # 1 Name of Project KAPCO Technology Commercial Operation Date 27.06.1996 Gross Capacity (MW) 1638 Net Capacity (MW) 1345 Energy Received July, 2006 to June, 2007 (GWh) 8183

GTs, Combined cycle, Steam Turbine on LSFO/Gas/ Diesel Steam Turbine on Fuel Oil Diesel engines on fuel oil Steam turbines on fuel oil Steam turbines on fuel oil Diesel engines on fuel oil

2 3 4 5 6

Hubco Kohinoor Energy Ltd AES Lalpir AES Pakgen Southern Electric

31.03.1997 20.06.1997 06.11.1997 01.02.1998 10.03.1999

1292 131 362 365 117

1207.3 124 350.7 350.5 103.791

7212 806 1356 1943 539

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Power 7 Habibullah Coastal Power Fauji Kabirwala Power Rousch (Pakistan) Power Saba Power Japan Power Generation Uch Power Altern Energy Liberty Power CHASNUPP JAGRAN RETNAL POWER STATION TAVANIR, IRAN Combined cycle on natural gas Combined cycle on gas Combined cycle on fuel oil Steam turbine on fuel oil Diesel engines on fuel oil Combined cycle on low Btu gas Flared gas/Gas Engine Combined cycle on natural gas Nuclear Hydel Gas Turbine 23.10.2000 22.02.2007 11.09.1999 140 129.15 966

8

21.10.1999

157

151.2

1184

9

11.12.1999

450

395

3090

10 11 12 13

31.12.1999 14.03.2000 18.10.2000 06.06.2001

134 135 586 10.5

125.55 107.0 551.25 5.13

868 528 3889 0

14 15 16 17

10.09.2001

235 325 30 150

210.341 300 30 150

1305 1944 96 213

18

Import from Iran Total:

Sep. 2003

39 6296.5

39 5674.912

171 34293

TRANSMISSION & DISTRIBUTION
In 1947, we had only 1200 KMs Transmission Lines. The total length of transmission lines now stands about 4665 Km. WAPDA's Power Transmission Lines system is interconnected through a National Grid which extends power from Peshawar to Karachi - Quetta and Azad Kashmir linking all important cities of the country.
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There are 9 Distribution Supply Companies namely Each Distribution Company is headed by Chief Executive. Area of Jurisdiction in respect of each Distribution Company is as under Name of Distributio n Company LESCO GEPCO FESCO Area of Jurisdiction

Sheikhupura , Kasur , Lahore , Okara . Gujranwala, Sialkot, Mandi Bahauddin , Hafizabad , Narowal , Gujrat . Faisalabad , Sargodha , Khushab , Jhang , Toba Tek Singh , Bhalwal , Mianwali , Bhakkar Districts of Punjab Province . Islamabad , Rawalpindi , Attock , Jhelum , Chakwal . Rahim Yar Khan , Multan , Khanewal , Sahiwal, Pakpattan , Vehari , Muzaffargarh , Dera Ghazi Khan , Leiah , Rajan Pur , Bahawalpur , Lodhran , Bahawalnagar . Whole Province of NWFP . Whole Province of Sindh except Karachi where KESC is responsible for distribution of power . Whole Province of Balochistan .

IESCO MEPCO

PESCO HESCO QESCO

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CONSUMPTION OF ELECTRICITY
With the sole exception of fiscal year 1998/99, power consumption has grown steadily in recent years. Between 1990/91 and 2003/04, total consumption increased by more than 84%, from 31 TWh to 57 TWh. Again, with a single exception - fiscal year 1990/91 – the domestic sector was the consumer group with the largest proportion of consumption, followed by industry and agriculture. The demand for electricity will continue to rise in the years to come. An average annual increase of 7% has been postulated. After recording at an average rate of 6.1 percent per annum since 1999-00 to 2007-08, the electricity consumption by different sectors increased merely by 0.7 percent during July-March 2008-09 against the comparable period last year. This trend of the decelerating growth of electricity consumption started in 2006-07. With the exception of Other Government Sector, all remaining sectors witnessed a negative growth during July-March 2008-09 over the same period last year. Reduction in consumption of electricity by different sectors is due to a shortage of electricity, its higher cost due to gradual phasing out of a subsidy on electricity, and the circular debt problem.

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CONSUMPTION OF ELECTRICITY Fiscal Year 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Avg. 10 Yrs ELECTRICITY (Gwh) 43,296 45,586 48,584 50,622 52,656 57,491 61,327 67,603 72,712 73,400 Increase (%) 5.3 6.6 4.2 4.0 9.2 6.7 10.2 7.6 0.9 6.1

CONSUMPTION OF ELECTRICITY BY SECTORS Gwh (000) Year Househ old Gwh(00 0) 19.4 21.4 22.8 Commer cial Gwh(00 0) 2.4 2.5 2.8 Industri al Gwh(00 0) 12.0 13.2 14.3 Agricult ure Gwh(00 0) 5.6 4.5 4.9 Street Light Gwh 224 239 213 Other Govt. Gwh(00 0) 3.6 3.6 3.5
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1998-99 1999-00 2000-01

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2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08

23.2 23.7 25.8 27.6 30.7 33.3 33.7

3.0 3.2 3.7 4.1 4.7 5.4 5.6

15.1 16.2 17.4 18.6 19.8 21.1 20.7

5.6 6.0 6.7 7.0 7.9 8.2 8.5

212 244 262 305 353 387 415

3.5 3.4 3.7 3.8 4.0 4.4 4.5

GROWTH IN CONSUMERS
The pattern of consumption underwent a gradual transformation during the period 1960–98 The major beneficiaries of power sector development in Pakistan were the general populace, i.e., the households. Its share went from 12.81 percent in 1960 to 42.08 percent in 1998. Electricity Used By Consumers Category (MLN Kilowatt Hours) Domesti Commer Industri Agricult Others c cial al ure 120 258 546 917 2012 5091 66 179 337 468 595 1375 531 1409 2299 3056 4056 6317 67 277 965 1539 2067 2795 77 278 590 851 1069 2030

Year 19591960 19641965 19691970 19741975 19791980 1984-

Total 860 2401 4737 6831 9799 17608
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1985 19891990 19941995 19971998 9402 15583 18724 1964 1941 2333 10333 12528 12297 5027 6252 7004 2469 5360 4143 29195 41664 44501

Source: WAPDA & KESC power system statistics

With the expansion of the electricity network, the number of consumers has increased by 7,675 thousands since 1998-99. During July-march 2008-09, the growth of consumers stood at 4.2 percent as it reached 18.5 million consumers during July- March 2008-09 as compared to 17.7 million in same period last year. The share of domestic consumers remained 84.9 percent followed by the commercial and industrial sectors having a 12.3 percent and a 1.4 percent share respectively CONSUMERS BY ECONOMIC GROUP(thousands) Year 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Domesti Commerc Industri c ial al 8,912 9,554 10,045 10,483 11,044 11,737 12,490 13,390 14354 15,226 1,517 1,654 1,737 1,803 1,867 1,935 1,983 2,068 2,152 2,229 190 195 196 200 206 210 212 222 233 242 Agricultu ral 173 175 180 184 192 199 201 220 236 245 Others 8 8 8 8 9 10 10 10 11 11 Total 10,800 11,586 12,166 12,678 13,318 14,092 14,896 15,911 16,987 17,955

Source:WAPDA & KESC power system statistics
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VILLAGE ELECTRIFICATION
Pakistan’s increasing demand for energy is due in part to efforts designed to promote the process of rural electrification. Until 1995/96, the number of villages with access to grid power grew by 9 to 11% annually. Since then, however, the increasing connection costs have driven the growth rate down to about 2% per year. As of March 2003, approximately 73,000 (59%) of Pakistan’s roughly 125,000 villages were receiving electricity (compared with approximately 46,000 villages, or 37%, in mid-1993. Recently the Government of Pakistan has publicly announced an ambitious plan to provide basic power to all the citizens through out the country by the end of 2007. About 67.0 percent of the population of the country resides in rural areas with agriculture being the main occupation Keeping this fact in view and in order to increase the productivity of a majority of the population, the village electrification programme is being highlighted as a central component of the total power sector development programme. The number of villages electrified has increased to 66,280 since 1998-99. Furthermore, the village electrification facility has increased by 5.7 percent during the period of JulyMarch 2008-09 as compared to same period last year. The detailed trend of village electrification is. VILLAGE ELECTRIFICATION (in numbers) Year Pre WAPDA 1960-1963 1964-1968 1969-1973 1974-1978 1979-1983 1984-1988 1989-1993 1994-1997 Total 609 1041 557 719 4691 7622 12452 17953 18924 Cumulative Total 609 1650 2207 2926 7617 15239 27691 45644 64568
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Power sector development in Pakistan

1997-1998

1383

65951

VILLAGE ELECTRIFICATION (in numbers) Year Addition during the year 1,232 1,109 1,595 1,674 2,246 7,193 9,467 12,764 14,203 10,441 Progressive total 67,183 68,292 69,887 71,561 73,807 81,000 90,467 103,231 117,456 127,897 1.7 2.3 2.4 3.1 9.7 11.7 14.1 13.8 8.9 Growth(%)

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 July-March 2007-08 2008-09

8,840 5,566

126,296 133,463 5.7

The electrification of villages manifests transformation of the rural economy in checking the influx of rural workforce in search of work to the already
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Power sector development in Pakistan

populous cities and towns where the essential services supplied by the utilities are already over capacitated

EXPANSION OF GENERATING CAPACITIES (FUTURE OUTLOOK)
By reason of the projected increase in the demand for electricity by some 10,000 MW by the year 2010. To keep that from happening, or at least to minimize future supply deficits, Pakistan has adopted a systematic development plan called ‘Vision 2025’ that targets a long-term capacity increase of around 35,000 MW by the year 2025. That would be nearly twice as much power as was available at the end of 2002. Around two thirds of the additional power (22,563 MW) is slated to come from hydroelectric power plants. New gas-fired power plants are supposed to contribute 13% (4,680 MW), the same percentage as that to be generated by coal fired power plants (4,350 MW). New nuclear power plants with a total installed capacity of 1,800 MW (5%) are planned3. Finally, renewable sources of energy are supposed to account for more than 4% (1,500 MW) of the overall newly installed capacity. The planned expansion will cost approximately US$ 30 billion. In view of Pakistan's high national debt and persistent budget deficit, the government is intensifying its efforts to attract private investors.

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Power sector development in Pakistan

CONCLUSION
In Pakistan the current energy crisis stems from the decline in hydro sources of energy and over reliance on the expansive source of electricity. Presently, oil-based thermal plants accounts for 68% of generating capacity, hydroelectric plants for 30% and nuclear plants for only 2% This has led to a huge generation costs, which in turn adversely affect the economy over the past eight years. Rise in the oil prices pushing electricity tariff very high. As a result, manufacturing costs and inflation are at the rising trend, export competitiveness is eroded and the pressure on the balance of payments is increasing. These factors adversely affect the present growth trajectory of the economy.

Economic Development - KUBS

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