Power Ministry’s Refusal to Share Data About LNG Plants is Making Electricity Expensive for the Common Man

With growing prices of petroleum products, oil importers are benefiting from windfall profits. To make matters worse, the Power Division’s failure to provide the data for LNG demand by the power producers is hurting the common man who will be forced to pay a higher tariff for the electricity.

The ability to produce cheaper electricity makes LNG-based power plants a huge priority. However, due to official delays in supplying data to the Petroleum Division, consumers continue to suffer as the oil lobby continues to supply furnace oil at higher rates to power producers.

Despite repeated reminders, the Power Division has not entertained the Petroleum Division’s request for providing the data for LNG demand for the month of July, an official revealed.

This delay will provide an opportunity to the oil lobby to supply expensive furnace oil to power producers, which will put a burden on the consumers.

For reference, in May 2018, Rs 9.10 per unit tariff was charged for electricity produced by LNG-based power plants, which contributed 23.85% of the energy. In comparison, furnace oil-based plants produced energy at Rs 12.47 per unit electricity which was 19.3% of the overall electricity produced.

The introduction of new state-of-the-art LNG-based plants, electricity produced will be 60-70% cheaper as compared to that produced by furnace oil, making per unit charges to be Rs 7-8.

With first LNG terminal at Port Qasim receiving 600 million cubic feet of LNG per day (mmcfd), the government intended to import the same volume of LNG at the 2nd LNG terminal as well. However, it might not be able to do so, importing only half of the intended volume.

For power production, the total demand for LNG is over 1,200 mmcfd, and the Power Division is required to produce 6,500-7,000 MW electricity using LNG before the furnace oil-based plants start their operations. The non-disclosure of LNG demand has given the oil lobby more opportunities to charge more, and in the process, cause huge losses to the national exchequer.

Via Tribune

Head of Sports and LENS at ProPakistani.pk



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