Pakistan recorded its highest power generation of 143,192 GWh (16,346 MW) in FY22, up 10% year-on-year, mainly driven by an overall recovery in economic activity and increased demand amid rising heat levels.
Hydel contributed the most to power generation (25% in FY22 vs 30% in FY21), followed by RLNG (19% in FY22 vs 21% in FY21) and coal (19% in FY22 vs 21% in FY21 ). energy production.
On the other hand, nuclear, gas, fuel oil (FO) and wind generation contributed respectively 13%, 10%, 9% and 3% to the country’s electricity production during the exercise 22.
The main contributor to electricity production
In absolute terms, nuclear and FO contributed the most to incremental electricity generation, followed by wind and HSD electricity generation. On the other hand, the production of electricity based on hydel remained limited in a context of low water inflows.
A new addition to the system includes Punjab Thermal Power (1,320 MW capacity), Karachi Nuclear Power Plant – Units 2 and 3 (1,140 MW and 1,145 capacity), Karot Hydropower (720 MW capacity) and Lucky Electric Power (660 MW capacity). MW).
Wind-based generation increased 58% year-on-year due to the addition of 700 MW of generating capacity in the system.
Total installed capacity in the country reached 39,427 MW in FY22 from 34,550 MW in FY21.
Electricity generation jumped by more than 20% on MoM in March 2022, mainly due to higher demand as part of an electricity tariff reduction of Rs5/unit announced by the former Prime Minister Imran Khan on February 28, 2022.
However, power generation began to decline from May due to the unavailability of fuel, including RLNG and coal, amid higher international prices and the closure of some power plants due to technical problems.
Economic activity remained buoyant, with Pakistan’s GDP growing 6% in FY22. Along with GDP, the Large Scale Manufacturing (LSM) index improved by 11.7 % YoY during 11MFY22.
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With an economic slowdown where we expect GDP to be between 3.5% and 4% in FY23 amid higher interest rates, higher energy prices and currency devaluation, we expect electricity demand to remain contained.
Average fuel production cost increased by 93% year-on-year to Rs9.3/KWh in FY22 from Rs4.8/KWh in FY21. In Jun-22, fuel costs increased by 160% YoY and 12% YoY to Rs. 14.7/unit.
Interestingly, around 50% of Pakistan’s electricity generation comes from RLNG, coal and FO, with an average fuel cost of Rs 17/unit in FY22. The remaining 50% of generation of electricity cost around Rs2/unit.