ISLAMABAD: The World Bank has agreed to provide $150 million to Pakistan — $135 million as a loan for the country’s energy sector and $15 million in the form of a grant.
The objective of the project is to improve and protect the efficiency of the energy sector. Commercial, industrial and residential buildings will be converted from gas to electricity.
An annual saving of Rs2.91 billion has been estimated from the implementation of the project. The construction of energy-efficient buildings will be encouraged. Besides, private sector investment in the energy sector will also be promoted.
Shifting gas consumption to electricity may have been motivated by the continuous decline in gas reserves and supplies. New gas finds have not been there. There is despondency in the gas sector partly because of the law and order issues in the potential gas deposit-containing areas.
Liquefied natural gas (LNG) supply was not there as well because of the international situation, where prices have been unstable and increased to unaffordable levels.
The assumption in substituting gas with electricity is that local energy sources including solar, wind, hydro and Thar coal, which are cheaper and abundant, will be used in generating power.
And if at all, combined-cycle gas-fired power plants will be used, which are efficient and produce cheaper electricity than others. In the case of household users, rich and well-to-do may be able to shift to electricity much easily than the lower-income groups. –Agencies
