The highest power generation recorded in Pakistan in FY22
Pakistan recorded its highest power generation of 143,192 GWh (16,346 MW) during FY22, up 10% YoY, primarily led by an overall pickup 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) based power generation.
On the other hand, nuclear, gas, furnace oil (FO), and wind-based generation contributed 13%, 10%, 9%, and 3%, respectively, towards the country’s power generation in FY22.
The major contributor to electricity production
In absolute terms, nuclear and FO contributed most towards additional power generation, followed by wind and HSD-based power generation. On the other hand, hydel-based power generation remained restricted amid lower water inflows.
A new addition to the system includes Punjab Thermal Power (capacity 1,320 MW), Karachi Nuclear Power Plant – Unit 2 & 3 (capacity 1,140 MW & 1,145), Karot Hydropower (capacity 720MW), and Lucky Electric Power (capacity 660MW).
Wind power-based generation increased by 58% YoY due to the addition of 700 MW generation capacity in the system.
The total installed capacity in the country touched 39,427 MW in FY22, compared to 34,550 MW in FY21.
Power generation witnessed a jump of over 20% on MoM in Mar-2022 primarily due to higher demand amid a reduction in electricity tariff by Rs5/unit announced by Former Prime Minister Imran Khan on Feb 28, 2022.
However, power generation started to decline from May onwards due to the non-availability of fuel, including RLNG and coal, amid higher international prices and the shutdown of a few plants amid technical issues.
Economic activity remained upbeat, with Pakistan’s GDP growth of 6% in FY22. Along with GDP, the Large Scale Manufacturing (LSM) index has improved by 11.7% YoY during 11MFY22.
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With an economic slowdown where we expect GDP to clock in at 3.5%-4% in FY23 amid higher interest rates, higher energy prices, and currency devaluation, we expect power demand to remain contained.
The average fuel generation cost was up by 93% YoY to Rs9.3/KWh in FY22 compared to Rs4.8/KWh in FY21. In the month of June-22, fuel costs went up by 160% YoY and 12% MoM to Rs. 14.7/unit.
Interestingly, around 50% of Pakistan’s power generation is from RLNG, coal, and FO, with an average fuel cost of Rs17/unit in FY22. The remaining 50% of power generation is at the cost of around Rs2/unit.
