Merit in gas distribution can save additional $2 billion annually

*IWCCI Suggests Measures To Resolve Energy Crisis*

*Conversion of power plants to coal to save $5 billion per annum*

*Merit in gas distribution can save additional $2 billion annually*

* Coal, key contributor to development remains ignored in Pak*

*Coal based power generation can boost crawling economy*

*Dated: March 12*
The Islamabad Women's Chamber of Commerce and Industry (IWCCI) said on
Tuesday government should push power companies using furnace oil to switch
to coal driven low prices, stability and vast supplies for years to come.

Coal is the cheapest and the most common fuel used to produce electricity
and heat in the world, its share in world’s energy mix has hit record high
with 5.4 per cent increase, it said.

With 1004 billion tonnes of known coal reserves left on earth and global
consumption estimated at 9.98 billion tonnes per annum by 2030, Pakistan
can become a major player with 175 billion tonnes of coal, said Farida
Rashid, President IWCCI.

Thar coal is sufficient to meet our fuel requirements for centuries and
help export electricity to regional countries opening door for prosperity
but it remained largely ignored, she said.

Speaking to business community, she said that we are paying a very heavy
price for running power plants on furnace oil and natural gas while the
slow pace of the government’s decision to convert some the furnace oil
based power plants to coal is frustrating.

Conversion of furnace oil based power plants on Thar coal can save around 5
billion dollars of foreign exchange per annum as furnace oil imports stands
at 40 per cent of total petroleum imports that are over 12 billion dollars.

Farida Rashid adding that switching on coal should be made easier for the
private power producers seeking permission since long as conversion to
imported coal will also save billions, she observed.

Conversion will cut oil import bill, reduce borrowings, clip subsidies and
bring production cost down providing relief to domestic, commercial and
industrial consumers, she added.

Farida Rashid said that conversion will also help cull circular debt which
is biggest threat to the economy, bridge budgetary gap, make funds
available for new investment on public welfare and power sector betterment
and improve balance of payments position.

She said that some two billion dollars could also be saved by ensuring
merit in provision of gas to the power plants, a decision implementable
within an hour. This can be ensured by preferring most efficient power
plants irrespective of the fact that they are state-owned or privately
owned units.

Alternatively, government can take steps to improve productivity of
inefficient public sector electricity generation companies which are
preferred in provision of gas.

Business community believes that the resolution to power woes lies in
conversion to relatively stable fuel because volatile global oil prices
have resulted in huge circular debt and unmaintainable generation cost.

Government can consider asking IPPs to convert to coal, largest
carbon-emitting energy source of all, otherwise the circular debt will soon
cross Rs one trillion rupees mark, she warned.

Economy cannot be salvaged in presence of unstable power sector which is
facing many problems none of which is impossible to solve.

Presently, coal is responsible for 41per cent of global electricity
generation, with 1932 coal power plants, coal account for over 50 per cent
of all US electric generation while India with 126 plants is expected to
overtake America by 2025.

South Africa’s 93 per cent and China's 68.7 per cent electricity comes from
coal while Pakistan’s coal-based power production is insignificant. We
should take steps to balance our energy mix and improve dismal per capita
energy consumption to boost economy.
--
Farida Rashid,
President, IWCCI
(Islamabad Women's Chamber of Commerce & Industry)