The government is considering placing a temporary ban on gas supply to industrial units for generating their own electricity, Express Tribune reported.
The decision is said to be taken in the wake of the depleting gas reserves and surplus electricity in the country. If this policy is put into action, it is also likely that the industrial concerns with captive power plants will be encouraged to apply for new electricity connections.
Sui Southern Gas Company (SSGC), and Sui Northern Gas Pipelines Limited (SNGPL), are engaged in the transmission and distribution of natural gas in the country. With time, the available gas for SSGC and SNGPL has decreased due to the natural depletion of reserves, and new gas discoveries have not been equivalent to the fall in reserves. At the same time, there has not been any net increase in locally produced gas supply for the past many years.
Over the last two years, gas reserves have seen a depletion of about 9.4 percent (over 400 million cubic feet of gas per day, mmcfd). This led the government to conduct an exercise to assess the consumption of gas by the captive power plants.
Out of the total 1,211 captive power plants, only 227 (159 under SSGC and 68 under SNGPL) are co-generation units, which not only generate power for self-consumption but also generate heat energy for industrial use, the study concluded.
Every winter, demand from residential consumers increases manifold, and gas supplies are constrained to undertake load curtailment programs.
The gross/installed power generation capacity in the country is estimated at 38,707 megawatts, whereas the anticipated capacity of power projects in the pipeline is 12,464MW, the newspaper reported.
Accordingly, the Petroleum Division came up with policy guidelines to distribute available gas supply to cater to the demand from the industrial, commercial, and CNG sectors.
The policy directives say that the natural gas supply shall be discontinued, with effect from February 1, 2021, to all industrial units currently using it as fuel for the primary purpose of electricity generation for self-consumption.
However, this will not apply to those industrial units, which are either not connected to the electricity distribution grid or using it as fuel for the primary purpose of steam generation (co-generation units).
Those industrial units that are currently using natural gas as fuel for electricity generation but are not connected to the national grid will be encouraged to apply for a new connection from the relevant distribution company, as a result of this new policy as well.