884MW adding to the electricity surplus- marginal pricing is the way forward!

News Image

A A H Soomro | March 08, 2024 at 07:18 PM GMT+05:00

0:00

March 08, 2024 (MLN): Brace yourself. The power tariff will go up further. Not that it is news nowadays. Policymakers conveniently blame the IMF, currency depreciation and high fuel prices.

Little do they ever tell that it is their inefficiency as well. Sometimes things are as clear as writing on the wall but lack of ownership and responsibility is the sheer cause of misgovernance. 

Large ticket infrastructure projects have a long gestation period for any new head of the department, division, ministry and cabinet to be aware of. Pakistan had planned a plethora of power generation companies - imported coal, local coal, hydel, nuclear and LNG - but never knew who would consume the molecules. Only long-term growth rates were forecasted. 

Did you do sensitivity to what would happen if economic growth slows, policymakers toy with boom and bust and let currency/current account deficit explode and fuel prices witness high standard deviation?

Was there any provision for delaying the offtake in such measures? Now 884MW would be added again - for whom?

Though hydel as a renewable source is cheaper and adds to water security, there must be a comprehensive plan to uplift the watts.

The government previously introduced a marginal pricing mechanism to enhance industrial consumption - residential consumption isn't elastic which is a very good idea to spur growth, reduce the cost of average unit consumed, control circular debt, create jobs and enhance tax revenues. 

The no-growth debt trap Pakistan is facing requires bold, aggressive and risk-taking policy making. The status quo will only crawl the masses to immigration, extinction or subsistence. Old inefficient thermal plants need to be bid farewell to or move towards the take-and-pay model.

Problems won't be resolved until DISCOs are dropped from the domain and handed to the private sector. PM must not give to provinces. Cheaper power, no subsidy and an industrial sector can pull Pakistan from the rabbit hole of oblivion. 

The author is an independent economic analyst and writes on Twitter and Linkedin.

Related News

Name Price/Vol %Chg/NChg
KSE100 148,815.31
210.52M
-0.45%
-677.75
ALLSHR 91,673.12
691.85M
-0.34%
-314.97
KSE30 45,206.45
71.88M
-0.69%
-311.96
KMI30 210,332.14
78.15M
-0.63%
-1334.91
KMIALLSHR 60,685.87
348.12M
-0.54%
-328.43
BKTi 42,003.35
40.78M
-0.82%
-349.19
OGTi 29,991.46
5.84M
-0.60%
-180.33
Symbol Bid/Ask High/Low
Name Last High/Low Chg/%Chg
BITCOIN FUTURES 111,450.00 113,800.00
110,655.00
-5400.00
-4.62%
BRENT CRUDE 68.63 68.71
67.57
0.90
1.33%
RICHARDS BAY COAL MONTHLY 92.00 0.00
0.00
1.45
1.60%
ROTTERDAM COAL MONTHLY 99.85 0.00
0.00
0.00
0.00%
USD RBD PALM OLEIN 1,106.50 1,106.50
1,106.50
0.00
0.00%
CRUDE OIL - WTI 64.66 64.71
63.53
1.00
1.57%
SUGAR #11 WORLD 16.43 16.56
16.30
-0.05
-0.30%

Chart of the Day


Latest News
August 25, 2025 at 05:02 PM GMT+05:00

SBP’s May FX intervention stands at $522m


August 25, 2025 at 04:55 PM GMT+05:00

Govt declares Rs1m grants for AI projects


August 25, 2025 at 04:32 PM GMT+05:00

U.S. to take nearly 10% stake in Intel under Trump deal


August 25, 2025 at 04:21 PM GMT+05:00

Pakistan receives $695m external financing in July


August 25, 2025 at 03:55 PM GMT+05:00

PSX Closing Bell: Minor Key Day



Top 5 things to watch in this week

Pakistan Stock Movers
Name Last Chg/%Chg
Name Last Chg/%Chg