The share of hydropower in national energy is likely to decline sharply

The share of hydropower in national energy is likely to decline sharply

ISLAMABAD: According to a plan provided to the National Power Regulatory Authority (NEPRA), the share of affordable hydropower in the national energy mix is ​​likely to fall from 30 percent to 20 percent by 2040.

The reason for this is the lack of role of the private sector as the government is trying to renegotiate the terms of agreements with thermal power producers.

According to the media, due to the forecast of low economic growth rate in the coming years, the government had reduced the estimate of electricity demand for the year 2040 to 390,240-gigawatt hours (GWh) while In June last year, the estimate was 458,000 GWh.

Similarly, the National Transmission and Dispatch Company (NTDC) estimates that power generation capacity will have to be increased to 62,000 MW instead of 98,000 MW under the previous plan.

These estimates are part of the Indicative Generation Capacity Expansion Plan (IGCEP) submitted by NTDC to NEPRA for approval.

The plan shows that over the next 20 to 27 years, the increase in hydropower capacity will be driven by public sector investment, including dams.

The plan estimates hydropower to be 30 percent of the total energy mix, which is expected to fall to 26 percent by FY 2035 and 20 percent by 2040 with further reductions.

This seems to be the case in 1990 when the government (thermal) was fighting with independent power producers (IPPs) for higher prices (6 paise per unit) and over-capacity contracts, while private sector investment. Was temporarily suspended.

The then government then rejected its announced tariff of 4.7 paise per unit for hydropower plants and instead asked investors to accept or waive the tariff of 3.3 paise per unit.

On the other hand, the bureaucracy in the Department of Energy or the Ministry of Energy, which in the last 10 years has fixed 90% of energy production from imported plants and made them 'mandatory', contrary to the national policy of 'maintaining merit', It has begun to create a similar environment to divert attention from re-deficit, dysfunctional and corrupt public sector entities.

The IGECP report pointed out that a total of 79,449 MW capacity projects would have to be added to meet the demand by 2040.

As a result, a dozen investors returned and there was no increase in hydropower capacity except in the public sector.

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