ADB extends $ 2 mln aid for energy projects

Singapore, Nov 5 (UNI) The Asian Development Bank (ADB) is helping Pakistan develop an energy model with a two million dollar grant that would enable the South Asian nation pursue an energy sector development plan to meet the needs of an expanding economy.

ADB is extending the aid for Pakistan's Integrated Energy Model project, estimated to cost 2.5 million dollars. The government of Pakistan will cover the balance.

''The outcome will be a functioning energy planning unit producing regular integrated analysis of strategic energy options,'' said Jim Liston, Principal Energy specialist of ADB's Central and West Asia Department.

A trained energy planning team will manage the unit and propose strategies for meeting energy requirements at the least cost and in a sustainable manner for consideration by national policy makers.

The factors that will be addressed by the unit cover finance, economics, energy supply, national resources, energy use, environmental impacts, technologies, energy efficiencies, and socio-political impacts.

Pakistan's Medium-Term Development Framework 2005-2010 sets out to achieve an eight per cent annual growth in gross domestic product, while energy consumption is estimated to expand 12 per cent a year for the same period.

This expected growth will put pressure on Pakistan's energy supply. Country energy analysts believe Pakistan needs to come up with an integrated, optimal energy sector plan.

For one, the country's energy sector is made up of various ministries, with no single body having a dominant role in managing the industry. The country is also a net energy importer, with its energy needs supplied by multiple sources.

Advanced computer software applications available in the international market can model a country's overall energy demand and supply situation, and these integrated energy models can help planners assess the impact of various policy scenarios and support good decision making. Pakistan currently does not use such an integrated energy modelling tool.

Pakistan's primary energy supplies totaled 58 million tonnes of oil equivalent in 2005-2006. All domestic natural gas production is consumed and, without higher production, growth will need to be met through imports. Rising oil consumption and flat oil production have led to rising oil imports.

A lack of refining capacity also leaves Pakistan heavily dependent on petroleum product imports. Electricity supply is also limited due to insufficient generation availability, resulting in an estimated 1,500 megawatts (MW) of unmet demand.

The country is currently pursuing a wide range of energy projects, among them, the development of several international gas pipelines. The government is also looking into the development of coal reserves in Tharparkar Desert and private sector power generation projects with total capacity of 2,000 MW using imported coal.

The government also plans to proceed with a large multipurpose dam on the Indus river for irrigation needs and to supply 8,000 MW of electric generating capacity.

UNI