Pakistan has faced some of the greatest electric shortfalls over the last 6 to 7 years. Consumers have had to bear the brunt of the double whammy of extensive load shedding and high electricity tariffs causing much grief and inconvenience. Life, as we knew it before load shedding, had changed completely. Load shedding in Pakistan has usually dictated people’s schedules and lives resulting in inconvenience, business disruption and inflation. With most of the rural populations not being able to afford UPSs or generators, this results in a lot of inconvenience and severely impedes daily life. Children are not able to study in classrooms properly because it gets really hot without fans.
So what is load shedding?
Simply put, when the demand for electricity exceeds the supply it becomes necessary to cut electric supply in certain areas. This process is termed as load shedding. The extent of the demand supply deficit determines the scale and duration of load shedding. During the 2014 summer in Pakistan, there was a shortfall of 6,000 megawatts with demand escalating to 17,000 megawatts with a production capacity of only 11,000 megawatts. The consequence was 10 to 18 hours of load shedding every day. During the summer months, when the mercury shoots up 45C or more, load shedding hits the population even harder.
Causes of Load Shedding in Pakistan
Inefficiencies, political corruption, line losses and circular debt have been attributed to the ongoing power crisis in Pakistan resulting in
massive load shedding and outages. Although the current installed electricity generation capacity in Pakistan is around 22,797MW, most of it is unavailable due to non-payments to Independent Power Producers (IPPs) by the government, line losses and administrative ineffectiveness. There are around 20 IPPs in Pakistan with a capacity of 7070 megawatts constituting almost 30% of the total electricity mix. Additionally, Pakistan relies on expensive fossil fuels such as oil to generate electricity, which is passed on to the consumers in the form of high electricity bills. Despite the high production cost, government has been offering subsidies in the past resulting in the buildup of circular debt since there is a net deficit. The cost of production is higher than the sale price of electricity resulting in an ever-increasing circular debt. However, the government is now reducing subsidies due to pressure from various donors such as the IMF.