Govt to Increase Power Generation Capacity by Three Times

  • The government is set to increase the country’s power generation capacity by almost 300% in the next to 111,000 megawatts.
  • The plan is finalized by National Transmission and Despatch Company in consultation with all the federal and provincial agencies.
  • The plan will gradually phase out almost all of the existing thermal power plants.
Govt to Increase Power Generation Capacity by Three Times
Govt to Increase Power Generation Capacity by Three Times

The government is planning to increase the country’s power generation capacity by almost 30o% in the next 20 years.

The power generation will be increased to 111,000 megawatts. The government will also phase out all of the existing thermal power plants to meet rising energy demand at affordable costs.

This move is a part of the Indicative Generation Capacity Expansion Plan (IGCEP) 2018-40 finalized by the National Transmission and Despatch Company in consultation with all the federal and provincial agencies.

The IGCEP 2018-40 represents the first complete iteration of an integrated planning exercise for the power sector of the country. It will be revised every year on the basis of ground realities including growth trajectory, consumption patterns, and completion or delays in projects to ensure regulatory compliance.

The plan sets current total capacity at about 29,000MW even though total installed capacity stands at about 33,500MW including:

  • 3,000MW of coal-based plants
  • 9,700MW of hydropower plants
  • 20,000MW of thermal plants
  • 1,345MW of nuclear
  • 1,900MW of renewables

Furthermore, 61% contribution comes from all thermal sources, 29% hydro, 6% from renewables and 4% nuclear. Power generation goes up to 153,000 Giga-watt Hour at present.

Thermal Plants to be Phase-Out in 20 Years:

The thermal plan has been firmed up on the basis of three different economic growth scenarios until 2040. The government will have to increase its generation capacity to 65,100MW at 4.5% GDP growth rate to generate 370,500GWh.

In the case of a 5.5% GDP growth rate, the capacity would need to be expanded to 80,500MW to generate 458,000GWh.

In a growth rate of 7%, the capacity will be increased to 111,000MW to make available about 630,500 GWh.

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By the year 2025, the government will also make capacity addition of about 17,300MW including 6,000MW in public sector and 11,300MW in the private sector. 8,600MW would be added to the system by the year 2030.

The Indicative Generation Capacity Expansion Plan (IGCEP) is targeting a total capacity addition of about 98,100MW by 2040. This would include 29,000MW of hydropower plants followed by 20,000MW through local coal-based plants, mostly in Thar.

The thermal plan envisages decreasing the capacity of Liquefied Natural Gas-based plants while a total of about 9,000MW current oil-based plants would be phased out by 2040.

The nuclear power generation capacity would go beyond 4,300MW as a series of large plants of 1,100MW each is completed.

In addition to these, about 16,000MW capacity addition has been planned through renewable sources; wind, solar, bagasse. Whereas, imported coal-based generation capacity would increase to 5,000MW.

The plan is also based on existing policy limitations and system constraints. All the strategic projects have been considered for the plan.

The policy will continue to focus on the least-cost generation options and on harnessing indigenous resources, particularly Thar coal and renewable in the south and hydro potential in the north.

Concerning this, a project is considered as committed provided the project is already under construction or has achieved financial close or has strategic importance i.e. China-Pakistan Economic Corridor (CPEC) Project or Public Sector Committed Projects.

It also takes into account the commercial operation dates for committed and candidate power projects conveyed by project executing agencies and further rationalized by the Prime Minister’s Task Force for Energy Reforms.

Wind and Solar Power:

From the year 2021-22 and onward, wind and solar power would be developed in the blocks of 500MW and 400MW respectively. Due to high-annualized cost, projects like Chiniot, Kaigah, Tungas, Yalbo, and Basho have not been included for this report.

Similarly, 1,320 MW Oracle Thar-Based plant, though being a CPEC project, has not been considered as a committed one because of its changing characteristics and completion timelines.

From this year, the gap between nominal capacity and the demand is steadily widening, and the same start surpassing the peak load of the system.

In the year 2032, the cumulative nominal capacity is estimated at 62,979MW whereas the peak load is projected at 50,306MW. Thus, a wide disparity of around 13,000MW exists between the two parameters and the capacity is in surplus as compared to demand.

In 2040, the total nominal capacity in the system would stand at 98,091MW against a peak load projected as 80,425MW.

Therefore, a significant surplus of around 17,600MW has been estimated between the projected demand and the installed capacity, like a spinning reserve.

With the current costs of renewable energy and the increase in costs for imported fuels and currency devaluation, the least cost generation plan utilizes large quantities of hydro capacity, Thar Coal-based generation.

The thermal plan didn’t take into account the impact of demand-side management and net-metering because of non-existent or ineffective policy direction.

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