Gas for the grid

The debate over gas allocation in Pakistan’s energy sector has focused too heavily on the needs of captive power plants, at the expense of efficient grid-connected power plants. With the shift towards cleaner energy sources and the growing demand for reliable grid power, it is essential to prioritise the needs of grid plants. By diverting gas currently allocated to captive plants towards efficient grid connected power plants, the government can increase grid power generation and reduce the likelihood of gas company defaults. This would allow grid plants to move up the merit order, ensuring a more efficient use of gas resources.

The argument that shifting gas away from captives will harm exports is unfounded. When gas prices rose last year, exporters feared a collapse in exports, but this did not happen. By creating a more equitable industrial environment with lower grid tariffs, exports will remain competitive, and businesses will benefit from a more reliable and affordable energy supply. The government must act to free up gas for grid plants and ensure that captive users pay a fair price for the gas they consume.

Tanzeel Khanzada

Karachi