Pakistan’s energy security is premised upon a host of factors i.e fossil fuel sources, renewable energy, and a balanced mix of power generation cum energy mix. Despite all the promise and forecasts about renewable revolution some technical limitations still stand in the way of fossil fuel supersession in the merit order of the fuel sources. Pakistan blessed with a hydel potential of 41722 megawatts of which around 7000 mw has been exploited so far remains far behind other countries in husbanding of husband resources. With a wind potential of over 50000 megawatts and solar power bounty of 2.334 million megawatts the country still imports fossil fuels accounting for around 25% of our foreign exchange imports. With 185 billion of estimated lignite coal reserves in Thar Pakistan has still not made much headway in making coal as a substantial part of energy mix. For understanding the existential threat to our energy security there is a need to identify clearly the policy errors that landed the country in a high risk zone on energy front.
Pakistan has made some egregious errors of omission and commission on energy front that has resulted in perennial power crisis with concomitant high cost of imported fuels which has left our industry famished of affordable energy, making our exports uncompetitive and living condition unbearable. In order to understand the nature of those errors one needs to identify the elements central to the energy security. These elements include correct identification of the nature of our geography and fossil fuel exploration solutions, optimal exploitation of our renewable sources, balanced energy & power generation mix, efficient storage and power transmission grid, and politically neutral regional energy linkages. We appear to have failed on each of above counts.
Pakistan still does not have a clear roadmap for national energy or power generation mix. NEPRA that initially facilitated wind and solar farms through wind risk and other incentives has hunkered down failing to strike a right balance between the consumers’ interests and those of investors. The competitive bidding policy for wind and solar IPPs, ostensibly meant to bring down the cost of generation, has failed to lay down clear policy guidelines for the investors while the world moves on. The hydel-thermal equation that stood at 70-30% in sixties has now turned opposite putting strains on the precious foreign exchange reserves. The country is in dire need of a power generation mix policy.
Pakistan has made some egregious errors of omission and commission on energy front that has resulted in perennial power crisis with concomitant high cost of imported fuels which has left our industry famished of affordable energy, making our exports uncompetitive and living condition unbearable
The privatization of transmission and distribution network and doing away with single power purchaser i.e CPPGA needs to be attempted. Multiple power purchasers would result in competition induced efficiencies and end of capacity charges due to merit order based power evacuation. WAPDA meanwhile needs to focus on hydel resources and dams with adequate independence in planning and execution of mega projects. Priority must be accorded to technically feasible dams with less construction challenges like Kalabagh with a development strategy graduating from easy to difficult dams in phases. In the energy security matrix Oil & Gas exploration also emerges as an equally important element. The country that spudded the second oldest oil well of the world in 1866 needs to invest munificently in understanding its geology and exploration challenges to find the viable solutions. With a technically recoverable potential of 9.1 billion tons of oil equivalent, Pakistan’s recovery rate of 1 well in 3 has remained better than the global average of 1 in 7 wells. Despite that Pakistan has not made much progress on exploration front due to less magnitude of finds.
The two reasons blighting the oil &gas exploration in the country are insufficient resources and lack of enabling environment for oil exploration. In an energy security matrix prepared while comparing energy imports- exports ratio with energy intensity by a renowned firm, Japan despite being more import dependent lay on competitive quadrant of the matrix compared to correspondingly less dependent countries like India and Pakistan, both of which lay in vulnerable quadrant. The main reason of the vulnerability was the lack of energy efficiency in India and Pakistan compared to Japan.
First. The government must expedite the bidding process of exploration blocks linking incentives with performance of indigenous players. Security costs for the exploration companies to be minimized by treating threats to exploration teams as national security threats. A network of oil pipelines be planned at national level as per a central distribution strategy to make timely and economic use of explored resources. Offshore exploration being attempted by international firms should be joined in the initial stages by indigenous companies like MPCL and OGDCL to derive optimum benefit out of potential finds. The tax incentives and concessions to oil exploration industry be linked to their reserve replacement ratio to prevent depletion of fossil fuel resource reserves. A long term national energy and power generation mix road map should be framed in consultation with international experts and indigenous stakeholders and disseminated as soon as possible to remove the policy hiatus inhibiting investment in energy sector.
Energy security also requires regional linkages which make foreign policy, national security, and energy self -sufficiency interdependent. Considering its importance it is time we securitized this vital vulnerability as part of national as well as human security.