Energy-sharing:a solution to shortages in the region

By M. Zafar Haider Jappa

Many would consider it a highly ambitious and unfeasible idea, at least for the time being, but there is a strong possibility that Pakistan and Nepal can meet the electricity needs of the entire South Asian region. This is due to the fact that both these countries have enormous coal and hydro reserves. This is a workable plan provided the major regions of South Asia including India, Pakistan, Nepal, Bangladesh and international multilateral bodies, converge to a one point agenda, which is to free South Asia from power shortages for good. What is expected to implement such a plan is great leadership, sincere commitment and also assistance from international agencies and grants from donors.

Sustainable development in today’s world is simply unimaginable without a continuous supply of electricity to the various sectors of the economy. In South Asian context, its significance is rather more striking where a huge proportion of the population is suffering from poverty. Food security is precarious especially after the recent international financial meltdown. Poverty, hunger, terrorism and ignorance levels have been unchecked and not a single country of SAARC or South Asia seems to be immune to it. With all these problems hovering around, South Asian economies are also caught in a massive crisis of power shortage and excessive load shedding.

As of now, most of the countries of South Asia are in the grip of a sharp decline in power supply. India with a 155,000 MW electricity generation capacity is in need of further 65,000 MW to catch up with the high pace of development. Pakistan with a production capacity of 19,600 MW is suffering from an average shortfall of 3,600 MW. Bangladesh produces 4,148 MW and needs an additional 1,352 MW. Nepal, a tiny economy produces 61,748 MW but needs 400 MW in order to end 14 hours load shedding in a day.

Only Pakistan and Nepal have the capability to not only cater to the domestic electricity needs but can also supply electricity to their neighbouring countries like Bangladesh, India and Bhutan.

Coal - the black gold is found in all the four provinces of Pakistan. According to the Geological Survey of Pakistan (2005), Pakistan has huge coal resources, about 185 billion tons, out of which 3.3 billion tons are in proven/measured category and about 11 billion are indicated reserves, the bulk of which is found in Sind province. Thar coal reserves are one of the world’s largest lignite deposits discovered by Geological Survey of Pakistan in 1992, spread over more than 9,000 sq. km and adequate to meet the country’s fuel and power requirements. Thar coal alone can produce 100,000 MW for 300 years, if utilised optimally.

Unfortunately, despite being in abundance, coal as a source of power generation is yet to be tapped exponentially in Pakistan.

Coal is consumed for different purposes, including brick kilns, cement and power industry. Natural gas, followed by oil, hydro, coal, nuclear and LPG are major sources of energy production in Pakistan.

The Sindh government has established Thar Coal and Energy Board (TCEB) headed by the Chief Minister Sindh. TCEB has recently given a “go ahead” to some small projects that will produce electricity up to 2,450 MW. By 2020, these will be capable to produce 10,000 MW. The power generated through these projects will cost Rs2.5, far less than what it cost at the moment; Rs8-9 per unit. Finally, the Sindh government has come up with a solution to the ever widening electricity shortage that may that may jump to 54,000 MW by 2015. Both provincial and federal governments will invest Rs80 billion on infrastructure development to facilitate an easy access to areas having abundant quantities of coal.

Nepal is not different from Pakistan in the sense that it blessed with excessive economic resources. If Pakistan has the largest coal reserves, Nepal has the largest hydro power potential in South Asia. Presently, it is producing 61,748 MW of hydro power. In order to minimise the enormous demand and supply gap, Nepal is importing 110 MW from India. Nepal possesses 83,000 MW of hydroelectric power, although only 50 per cent is economically feasible. BBC presented a report in July 2009 projecting Nepal’s ambition for producing a mega project of 42,000 MW provided India agrees to extend the grid line over its territory. By 2013, Nepal envisions to export electricity to India just to reverse its status of electricity importer from the Bihar province of India. Cash-strapped Nepal is presently facing acute load shedding and recent floods have seriously ruined its supply of electricity from India, dampening its energy needs and sobering the pace of economic development.

India’s energy crisis has a positive correlation to its high ambition of being one of the world’s biggest economic giants. Like its size, its demand- supply gap in energy sector is the biggest in South Asia. A recent article published in the New York Times revealed, “There is no doubt that India’s electricity crisis is becoming all the more acute for the roaring pace of the country’s economic growth and new material aspirations it has generated.” Like Pakistan’s ministry of water and power, Indian planning commission had failed to achieve the target it had set in its 11th five year plan, leading to no end to the massive power breakdown. Indian government committed to the nation to provide “electric connections to all by 2009” which seems unfulfilled. The target of achieving 78,700 MW is too distant to attain. Surya P. Sethi, principal advisor to the Indian Planning Commission said to the media recently “the power generation target of 78,700 MW is not achievable by 2012. If everything goes well, then generation capacity of around 40,000 MW would be added.”

Though, coal is dominating India’s energy sector but more than one third of the coal plants do not meet national emission standards. Chronic power shortages and heavy voltage fluctuations have just enhanced the cost of business in India. A World Bank survey conducted in 2004 found that 60 per cent corporations in India have their own generators as an alternative arrangement to the frequent breakdowns.

India and Bhutan signed a protocol in 2006 by which Bhutan will export 10,000 MW of electricity to India by 2020. According to the “Overview of Energy Policies of Bhutan” (2009), its generation capacity is of 1,484MW, as Bhutan has a huge hydropower potential. Hydropower exports to India have boosted Bhutan's overall growth, even though GDP fell in 2008 as a result of a recessionary spiral in India, its predominant export market. New hydropower projects will be the driving force behind Bhutan's ability to create employment and sustainable development in the days to come.

Both Pakistan and Nepal have ratified Kyoto Protocol and are expected to comply with international commitments and laws on the safety of environment, whenever they decide to construct new projects to meet the needs of their neighbours, especially India. For coal based projects, CCS (Carbon, capture and storage) technology is highly reliable which does concern the environmentalists to a great extent. By using the same technology, Japan produces nearly 28 per cent electricity from coal and is one of the world’s largest coal producers.

Indian policy on energy needs to be more explicit. Despite its initial willingness to join Iran-Pakistan-India gas pipeline, India is indecisive based on the pretext of security concerns in Pakistan. At the same time, it demands access to Afghanistan en route to Pakistan. Incase the tripartite gas link is established, Pakistan would receive $700-900 m annually as royalty. This would not be openly accepted by India.

There are hundreds of other examples of power sharing among countries of Africa, Latin America, Central Asia and South East Asia. Brazil purchases electricity from Paraguay, China from Kyrgyzstan, Pakistan from Iran, Malaysia from Singapore, Mongolia from China and Russia and Thailand from Laos. South Asian leadership must rise to the occasion to initiate links on electricity sharing to eliminate poverty in the region. As it is, South Asia is already “off the track” on MDGs (Millennium Development Goals) as per the World bank report 2008, thus it is high time that concrete steps are taken to achieve some of these goals.