Nuclear energy becomes Pakistan’s main source of electricity

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Nuclear energy becomes Pakistan's main source of electricity

In December 2022, nuclear energy exceeded all other sources of energy in Pakistan for the first time, providing over 27% of the nation’s energy needs at a cost of less than 0.5 US cents.

Nuclear power generation was the second-most popular source in November after hydropower. 2,338 GWh of electricity from nuclear sources was added to the national grid.

Pakistan has been working vigorously to implement its strategy to increase the proportion of cleaner energy sources in its energy mix because fossil fuels, particularly oil and gas, not only have negative environmental effects but also have high costs. Islamabad imports fossil fuels for a large portion of its annual budget.

Out of the total amount of electricity produced in December from all sources, nuclear energy accounted for 27.15 percent (or 2,284.8 GWh) and was priced at Rs1.073/unit. Hydroelectricity came in second with 20.44 percent (1,720.4 GWh), followed by coal-fired power at 18.1 percent (1,520.9 GWh) and priced at Rs11.5/unit, natural gas at 15.13 percent (1,273.8 GWh) and RLNG at 13.7 percent (1,53.7GWh).

Additionally, 0.46 percent (38.91 GWh) of expensive power, priced at Rs25.7971/unit, was produced from furnace oil in December. High-speed diesel did not produce any electricity. In December 2022, the national grid received 2.5 percent (or 211.6 GWh) of its electricity from wind energy, 1.2 percent (101 GWh) from bagasse energy, and 0.8 percent (or 69.5 GWh) from solar energy.

Data released yesterday showed that as a result, Pakistan‘s power generation costs in December 2022 experienced a considerable decrease of 14.5 percent. The data also revealed that, when compared to the same month last year, the nation’s total power generation fell by 4.7% in the month under consideration.

The increase in nuclear and solar power output, as well as a YoY decrease in the cost of coal-based generation due to the inclusion of local coal-based plants, were the key drivers of the decrease in fuel costs on a YoY basis. According to Tahir Abbas, Head of Research at Arif Habib Limited, the fall in a nuclear and hydroelectric generation was what caused the fuel price to increase on an MoM basis.

The Central Power Purchasing Agency (CPPA-G) has requested approval from the National Electric Power Regulatory Authority for a reduction of Rs2.1995/unit in tariff for the Ex-Wapda Distribution Companies (XWDiscos) customers on account of fuel charges adjustments (FCA) for December 2022 based on less expensive energy generated in December. If authorized, Discos will reimburse you for your February 2023 invoices.

For December, the reference fuel prices from the consumers were Rs9.3193/unit whereas the real fuel cost was Rs7.1198/unit, according to the CPPA-petition G’s to NEPRA on behalf of XWDiscos. It needs to be permitted to return the overpriced amount of Rs. 2.1995 per unit to the customers.

The cost to produce 8,416.91 GWh of electricity during the month was Rs59.289 billion (or Rs7.044/unit), and the cost to deliver 8,096.88 GWh to Discos was Rs57.648 billion (or Rs7.1198/unit). 3.35 percent transmission losses were recorded in December (or 282.10kWh).

On January 30, 2023, the power regulator will convene a public hearing to discuss the CPPA-G petition

Due to the high price of imported fuel in earlier months, NEPRA was allowed to collect additional amounts from consumers. FCA for November 2022 was Rs4.3/unit, and payment would be received in bills for January 2023. The FCA, which was negative for October at -0.3213/unit, was being reimbursed to customers in their December bills.

It should be mentioned that the price of other fuels increased year over year. RFO costs rose by 16 percent, RLNG costs rose by 12.5 percent, and domestic gas prices rose by 25 percent.

According to the data, power generation decreased by 4.7 percent YoY in December of this fiscal year compared to the same month of the year prior. When compared to the same month in the previous financial year, power generation decreased by 4.7 percent YoY to 8,417 GWh (11,313MW) during the month under review. The generation grew by 0.6% month over month.

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