Energy crisis in Pakistan – where planning went wrong? 2


BRIGADIER (RETD) MUSHTAQ AHMED

Pakistan, though lacking in oil resources, is blessed with lots of streams, with enormous hydro power potential. Pakistan is also gifted with huge gas and coal reserves which are sufficient for many decades to meet the energy needs. The question arises that in the presence of huge gas, coal and water resources, where it went wrong that today Pakistan is facing acute energy crisis.
Our industries have virtually been rendered non-productive, and are suffering huge losses due to non-availability of gas and electricity. The inconsistent supply of gas and electricity has further aggravated the productive capability of industry, the highest price of electricity in the region not withstanding. This has virtually put tremendous pressure on the poor labour class which is facing lots of difficulties for its survival. The situation of small industrial owners is no different.I will not discuss the oil resources which are not even sufficient to meet domestic requirements, what to talk of their use in industry and power generation. There can be four major resources for generating electricity which are gas and coal for setting up thermal power stations, water for hydro electricity and technology for nuclear plants.

As per the reliable estimates, Pakistan is blessed with about 185 billion tonnes of coal reserves which can be used for coal based thermal power plants to generate over 15000 MW daily of electricity for over one hundred years.

The hydro power potential of the country is estimated to be 47,486 MW. The nuclear power production entirely depends upon availability of nuclear power plants. Presently, save for China – the most trusted friend – no country in the world is willing to offer us the nuclear power plant/ technology.

One plant of 350 MW is operational at Chashma and another one is in the process of installation; their consistent operation round the year (yearly maintenance time not being considered) carries many questions. It is also worth considering that most of the advanced countries have now set up nuclear plants of 650 MW and above, which are considered to be most viable and efficient.

The question now arises that keeping in view the precise availability of resources in the form of gas, coal and hydro power sites, with identified potential of source of each site and anticipated yearly growth rate of electricity, who made the mess in failing to devise proper strategy to ensure that balance in demand and supply of electricity (catering for spinning reserve) and what could be the reasons for this improper planning.

Basically three players – WAPDA (including PEPCO), Pakistan Privatisation Infrastructure Board (PPIB) and Ministry of Water and Power are responsible for identification, completion of feasibility studies, detailed designing of viable projects and their implementation. These players are further responsible to prioritise these projects and making comprehensive plans setting short term, medium term and long term goals/targets.

The scarlet thread in the planning should be that the availability in every year should be slightly more than the requirement of electricity in the corresponding year to cater for any unforeseen eventuality. At the time of creation of WAPDA in 1959, the total power generation capacity was about 119 MW. Pakistan had to lose control on the waters of River Ravi, Sutlej and Chenab after the signing of Indus Basin Treaty in 1960.

This loss of water, however, became the source of creating big reservoirs in the shape of Mangla and Tarbela. The country nearly got about 4700 MW hydel electricity from the Mangla and Tarbela Dams. With the installation of a number of thermal and hydel power stations, both by Independent Power Producers and WAPDA, and a nuclear power station at Chashma, the total installed capacity stood at about 19,530 MW in 2003.

Some planners at this juncture thought that keeping in view the total requirement of electricity during peak hours, which varied between 12500 to 13000 MW, the country had surplus of about 3000 MW which could be exported to India. The demand of electricity suddenly started surging from year 2003 mainly because of non-development activities.

The availability of split AC and other electric/electronic appliances on installments further blew the demand of electricity manifold and future planning carried out by WAPDA, PPIB and Ministry of Water and Power just turned out to be a useless paper. The energy crisis has accentuated to a very great extent. The industries have virtually come to a standstill. Children are studying and taking their examinations using candle lights.

This failure in meeting the requirement of electricity can mainly be attributed to the wrong policies of the Government of Pakistan and lack of vision, seriousness, dynamism and patriotism among the planners. The officials sitting in the ministries have been trying to please their political bosses who just had no plans, will, vision and concern for the country.

The major reason for this shortfall is that we only remained focused on the construction of Kalabagh Dam and did not accelerate the work on Neelum-Jhelum, Munda Dam, Bunji Dam, Bhasha Dam projects, Kohala, and other proposed projects to be completed by year 2010. Wapda, as per its vision 2025, had planned to achieve 9,986 MW of electricity by the year 2010 against the anticipated power shortage of 5000 MW.

THE PROPOSED MAJOR PROJECTS INCLUDED RAISED MANGLA: 130 MW, Neelum-JHELUM: 969 MW, Kalabagh: 3600 MW, Kohala (Jhelum): 740 MW, Matiltan: 84 MW, Gulpur: 116 MW, Abbasian-Jhelum: 125 MW, Rajdhani (Punch): 132 and combined cycle on gas/coal 3600 MW. These projects were to be undertaken by public/private sectors. The plan was excellent but the execution has been pathetic.

Out of all these projects only Raised Mangla along with some thermal power stations could come on ground. The additional power availability has been around only 300 MW against the planned capacity of 9,986 MW (3 percent).

Besides Hydro Power Projects to be undertaken by WAPDA, the Private Power Infrastructure Board (PPIB) has been signing many Letters of Intent (LOI)/Agreements and its chairman (Minister of Water and Power) has been making many local media statements after every meeting. The ground reality is that the PPIB has failed to set up any worthwhile project.

Rather, PPIB, supposed to serve as an instrument to help WAPDA – a prime mover for meeting energy needs – is acting as stumbling block in the efforts of WAPDA to overcome energy crisis. It has been due to the unprofessional strategy adopted by the PPIB that nothing has been achieved so far.

A regular reader, having some interest on energy resources, might have been feeling satisfied that PPIB has been able to sign about one hundred Letters of Intent, both with international and domestic investors. But the ground reality is that no worthwhile project has been added.

The cases of Kotli Hydro Power, Gulpur Hydro Power, Rajdhani Hydro Power and Munda Dam projects besides many thermal power stations can be quoted as examples where the Letters of Intent have been issued many years back. In some cases, even feasibility studies have been completed and Letters of Support have been issued, but nothing concrete has been done.

The so-called investors have come with the sole objective of making money and are on the lookout to find some other financiers to whom they could sell these agreements. The other player (the most important) responsible to ensure timely planning, and launching of mega projects is the Ministry of Water and Power.

However the main player has never been pro-active in its approach to cater for the energy needs. It, rather, has been acting as post office between WAPDA and PPIB. Its sole focus has been on media projection and grabbing power to be used for personal motives rather than focusing on national interest.

The Ministry has never served as a think tank to ensure identification, planning and implementation of power projects to keep a balance between the demand and availability of power potential.

 

 

THE FOLLOWING RECOMMENDATIONS MAY SERVE AS FIRST STEP IN INDICATING PLANNING FOR HANDLING ENERGY CRISIS AT VARIOUS LEVELS:

A dedicated cell should be formed at government level under the Planning Commission/Prime Minister Secretariat which should be responsible for detailed planning of energy requirements, keeping in view the realistic annual growth. This cell should serve as a think tank and should comprise specialist engineers and administrative staff.The boss of this cell should ensure preparation of short term, medium term and long term plans. The cell should have three sub cells, responsible for monitoring of studies, detailed planning and designing, award of contracts and finally implementation of construction within each sub cell.

The staff should have specialisation in both thermal and hydel projects. It should operate through monthly meetings to be attended by representatives of Ministry of Water and Power, PPIB WAPDA and PEPCO. The head of this cell should be a technically qualified officer and has to be a hard task master to ensure that every target is met by the scheduled date.

As per the National Power Policy, all the provinces are authorised to set up their own power plants up to 50 MW. Wapda, again, has done commendable work in identification of sites in each province. Unfortunately, none of the provincial governments has made any serious efforts to set up such plants and contribute towards the hydropower production.

The Government of NWFP can be given some credit in setting up Malakand III Project of about 80 MW, which will start generation soon. The Government of Punjab now seems to be keen to play its part in setting up small hydropower plants on canals. To achieve meaningful results, all provinces (interested in setting up hydel plants) must have a core set up on hydropower generation. There should be a separate Secretary of Power coming from a technical cadre to lead the provincial power cells.

There should be dedicated energy planning cell. The head of this cell again has to be a specialist. All cases received from WAPDA, PEPCO in the shape of PCII and PC1 should be processed immediately. All queries be resolved through meetings rather through letters which takes months to get upto date reply. The detailed organisation can be worked out at the Ministry.

The Private Power Infrastructure Board, which is almost non-functional with relation to physical result, is required to be made dynamic. No political interference should be allowed. The PPIB, through pro-active approach, should only work on the projects earmarked by the main core cell at Government level.

All Letters of Intent issued and agreements signed by PPIB should have cut off dates for completion of feasibility studies, detailed designing and commencement of work. No extension of time in any activity be granted. The present practice is that dummy investors, having political influence, are coming forward with the sole aim of subletting the project to some other investor and aiming at making money.

Progress of all agreements be monitored by the central cell and parties making no progress be given immediate exit. Though WAPDA has already devised a very comprehensive plan titled as Vision 2025, yet its implementation is lagging drastically behind schedule. There could be many reasons for this failure, but the most important being the bidding system.

As per the prevailing practices, only the lowest bid is accepted. Land acquisition process is time consuming and lacks flexibility. In most of the cases WAPDA fails to acquire the land required for the projects due to litigation process. Some projects have been delayed due to non -availability of material from identified sources as the influential cartels get sources on lease and later on dictate their terms with the contractor.

The Government of Pakistan/WAPDA should fix the cut off percentage lower than the engineer estimate beyond which the contractor should be declared as non responsive. Land acquisition process be started much before the award of contract so that the land is available by the time the contract has been awarded.

No quarries site be auctioned and WAPDA should be given basis of all borrow material quarry site. The contractor in turn will get the required material from WAPDA quarry sites at much lower rates which will subsequently reduce the overall cost of the project.

It has also been seen that some contractors abandoning their work on one project, instead of being put on blacklist and not to be considered for awarding of further projects, still have been awarded contracts due to outside pressure. This practice by WAPDA, instead of deterring, has encouraged other contractors to also adopt the same approach and thus abandon projects once they feel that they will be undergoing losses.

This vague policy of WAPDA has also contributed in the delay of a couple of mega projects. It is recommended that any contractor who abandons his project’s site without any valid justification be blacklisted and should not be considered for award of future contracts. WAPDA should expedite the commencement and completion of all projects conceived in Vision 2025.

No time should be wasted on penny-wise, pound-foolish approach, which presently is the main source of delay in the timely award of contracts. WAPDA should also carry out analysis of additional cost due to delayed award and subsequent delayed completion of projects, while undertaking projects’ bid evaluations and making decisions for re-bidding.

The people responsible for causing delay in the schedule of completion should be taken to task. There should also be some incentive, both for contractors and project authorities for the timely completion of projects. It has remained the policy of the Government to reward some retired bureaucrats and Government officials and make them the heads of technical departments, like WAPDA, KESC, and Railways; irrespective of their qualifications.

It is funny to assume that a good administrator would also be equally efficient in a technical department. A non-technical boss will always look towards his immediate subordinates, being totally unaware of the technical implications.

It is high time that people sitting at the helm of affairs should realise the ground realities and post technically qualified, capable and competent officers as heads of technical departments. If it is inevitable to reward non-technical, retired officers there are hundreds of non-technical slots both at the provincial and federal levels.

It is time that our leaders realise this very important aspect and stop posting non-technical officers as heads of technical departments. To conclude, it has gone beyond doubt that Government of Pakistan has miserably failed to cater for energy needs of the country. The concerned people have to make serious efforts to bridge the gap between demand and availability.

This is only possible if all players responsible for initiation and completion of power projects work in harmony and sincerely at each end and if our leaders stop posting non-technical men in technical departments as bosses. (The writer has done his Masters in Engineering from Purdue University, USA and has worked for over six years in WAPDA as General Manager Projects North)

 

 

Source: Business Recorder, 28/9/2008


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2 thoughts on “Energy crisis in Pakistan – where planning went wrong?

  • Badr Hashemi

    What khaleefa? Three of the four earlier khaleefas (alrashedeen)were murdered for personal greed and political benefits. Human nature never changes. Lets move on…lets move forward. Handling of the energy crisis or other crises in Pakistan is a different ball game. We need to play that game and win it.

  • Tanzeel ur rehman

    Assalam-o-alykum !!!
    In my view the problem of energy is not the energy crisis, its politicle problem, the Ruler of pakistan and other muslim countries are agent of west.they have no vision except making money for theirself. only islmic ruler (khaleefah) can take bold and good steps under the law of GOD. so start struggle to bring khilafah if you want to remove all problems.