ISLAMABAD-The consumption of petroleum products and electricity has declined by 22 percent and 6 percent respectively during July-March period of FY2022-23 mainly due to hike in its cost and low economic activities in the country.
During the first nine months of 2022-23, 7,102 additional gas connections (including 5,068 domestic, 1,948 commercial, and 86 industrial) were provided nationwide by the Sui companies, while they are expected to supply gas to approximately 520,801 new consumers (this target is subject to approval/revision by OGRA) during FY2024, said Pakistan Economic Survey 2022-23 released here Thursday.
The country’s total installed electricity capacity stands at 41,000 MW; the percentage share of hydel, thermal, nuclear, and renewable is 25.8 percent, 58.8 percent, 8.6 percent, and 6.8 percent, respectively, The share of thermal as a dominant source of electricity supply has declined over the past few years, showing the increased reliance on indigenous sources.
Moreover, the government plans to convert all commissioned imported coal independent power producers (IPPs) to Thar coal. With the addition of three power projects during the current fiscal year, the total installed capacity from five Thar coal-based power generation plants has reached 3,300 MW.
In Pakistan, the main consumers of petroleum products are the transport and power sectors, which account for 78.5 percent and 10.8 percent of the total consumption, respectively. However, during the current fiscal year, the demand for Motor Spirit (MS) and High Speed Diesel (HSD) has decreased mainly due to the high prices of these products, while the demand for Furnace Oil (FO) has declined due to the shift of power generation to re-gasified liquified natural gas (RLNG) or coal and other alternative sources. Thus, the total demand for petroleum products (16.72 million tonnes in July-March FY2022) has reduced by 21.9 percent during July-March FY2023. On the other hand, the natural gas consumption amounted to around 3,258 MMCFD from July-March FY2023, which included 631 MMCFD of RLNG volume.
Regarding the electricity consumption, the survey noted that the electricity consumption has decreased by around 6pc to 84,034GWh during July to March 2023 from 89,361 GWh during the same period last year. The household sector is the largest consumer of electricity, consumed 39,200 GWh or 46.6 percent of the total consumption during the ongoing fiscal which is 6.78pc less than the same period of previous year consumption of 42055GWh. During the ongoing fiscal, the industrial sector consumed 23,687 GWh (28.2 percent). The electricity consumption in industrial sector has decreased by 5.85pc from 25,160GWh during July-March 2021-2022 to 23,687 GWh during the same period this year.
Moreover, agriculture sector consumed 6,906 GWh (8.2 percent) during July-March 2022-23. The consumption in agriculture sector has declined by 15.17pc to 6,906 GWh during the ongoing fiscal from 8,151GWh during the same period previous fiscal year. The consumption in commercial sector also declined by 1.08pc to 6,576 GWh (7.8 percent) in 2022-23 from 6,648 GWh during the same period previous year. Whereas the electricity consumption in other sectors (streetlights, general services, and other government) recorded an increase of 4.31pc and gone to 7,664 GWh (9.1 percent) from 7,347GWh during the previous year.
The survey further said that PPIB is endeavoring to complete three IPPs of 2,154 MW during 2023-24. The US$ 1,707.7 million 884MW Suki Kinari project on river Kunhar in Mansehra is being developed under CPEC. About 88.5pc of construction work is completed. The 7.08 MW Riali-II Hydropower Project is a run-of-river project on Ghori Nullah, a right bank tributary of Neelam River in District Muzaffarabad and approximately 75pc of civil work finished. Similarly 700 MW Azad Pattan hydropower is a run-of-river project on river Jehlum at the border of AJK (District Bagh) and Punjab (District Rawalpindi). PPIB is implementing it with an investment of US$ 1,350 million in the CPEC framework. These projects should finish by December 2024.
Among several ARE projects, 3 solar projects of 150 MW, started under the RE Policy 2006, are expected to complete within the outgoing fiscal year. Besides, 1 bagasse project of 32 MW is expected to complete in January 2024. Regarding net metering, the survey said that as such, in July–March FY2023, 145 new installers received certifications, bringing the total number of active AEDB-certified installers to 307. Furthermore, net metering-based systems of 355.3 MW total capacity were installed by different consumer segments during the same period, while 50,656 installations totaled 863.4 MW as of March 2023.
Regarding oil sector, the survey said the total demand for petroleum products remained at 23.1 million tonnes during FY2022. However, this year witnessed a decline in demand to 13.1 million tonnes during July-March FY2023 from 16.7 tonnes in July-March FY2022. The declining trend may be attributed to a decrease in demand for FO, HSD, MS, and High Octane Blended Component (HOBC), which comprises more than 95 percent of the total demand. Furthermore, the transport and power sectors are major petroleum consumers, covering around 90 percent of total demand. On the other hand, the only increase is in Jet Fuel’s (JP-1 and JP-8) demand, which has grown 18 percent this year. As such, the demand for petroleum products decreased in all sectors ranging from 5.3 percent to 45.4 percent, except the overseas demand.
The decrease in MS and HSD demand may be attributed to the high prices and the decline in FO demand due to shifting power generation from FO/HSD to RLNG/Coal and other alternative sources. Overall, the total demand for petroleum products decreased by 21.9 percent during July-March FY2023 compared to FY2022. Pakistan is an importer of petroleum products and crude oil. Imports of petroleum products during July-March FY2023 are around 6.1 million tonnes, valued at wmore than US$ 5.7 billion. The major imported products are MS, HSD, and FO, with import quantities of 3,853.9 thousand tonnes, 1,645.6 thousand tonnes, and 530.6 thousand tonnes, respectively. As such, this year witnessed a significant decrease in imports of all five petroleum products. The crude oil import requirement of refineries during July-March FY2023 remained at 5,858.4 thousand tonnes, which was 6,802.3 thousand tonnes during the same period of FY2022.
During July-March FY2023, the average natural gas consumption was about 3,258 MMCFD, including 631 MMCFD volume of RLNG. During the same period, the two gas utility companies (SNGPL and SSGCL) laid a 225km gas transmission network, 1,170km mains, and 63km service lines and connected 92 villages/towns to the gas network. Furthermore, 7,102 additional gas connections (including 5,068 domestic, 1,948 commercial, and 86 industrial) were provided nationwide. During July-January FY2023, the total supply of LPG stood at 843,878 tonnes, wherein 79.6 percent was met through imports. Currently, 11 LPG producers and 273 LPG marketing companies operate in the country with more than 7,000 authorized distributors. Furthermore, an investment of approximately Rs 2.75 billion is made during July-March FY2023. During July-March FY2023, domestic coal production figured around 9,402.6 thousand tonnes, and about 6,576.6 thousand tonnes of coal was imported.