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    ENERGY

    The capacity of physical system to do work; the units of energy are joules or ergs; energy can

    take a variety of forms

    Energy is a fundamental quantity that every physical system possesses; it allows us topredict how much work a system could be made to do, or how much heat it can produce or

    absorb. In the past, energy was discussed in terms of easily observable effects it has no properties

    of objects or changes in state of various systems. Basically, if something changes, some sort of

    energy was involved in that change.

    The capacity for doing work forms of energy included thermal, mechanical, electrical and

    chemical. energy may be transformed from one form to another. the capacity for doing work as

    measured by capability of doing work(potential energy). Energy has several forms some of

    which are easily convertible and can be changed to another form useful for work. Most of the

    worlds convertible energy comes from fossil fuels that are burned to produce heat that is thenused as transfer medium to mechanical or other means in order to accomplish tasks, is properly

    something as that enable it to do work. The unit of energy is joules (j). the basic forms of energy

    are kinetic energy, potential energy and rest energy. The law of conservation of energy states that

    energy can be neither created nor destroyed, although it may change from one form to another

    (including mass).

    Different sources of energy.

    Energy

    Depletable

    Fossilcell

    Oil Gas Coal Wood

    Nuclear

    Nondepleteable

    Hydro Solar WindBio-mass

    Bio-oil

    Bio-deseil

    Etanol

    Bio-gas

    Fuel

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    Deplete able energy

    Coal ,oil and gas are called fossil fuels:coal oil and gas are called fossil fuelsbecause they have been formed from the organic remains of prehistoric plants and animals. Till

    1990s they provided around 66% of the worlds electrical power, and 95% of worlds totalenergy demands (including heating, transport, electricity generation and other uses)

    Advantages

    Very large amount of electricity can be generated in one place using coal, fairly cheaply.

    Transporting oil and gas to power stations is easy

    Gasfired power stations are very efficient.

    A fossil fuels power station can be build almost anywhere, so long as you can gat large quantities

    of fuel to it. Did cot power station, in oxford shire, has a dedicated rail link to supply the coal.

    Disadvantages

    Basically, the main drawback of fossil fuels is pollution. Burning any fossil fuel produces carbon

    dioxide, which contributes to the green house effect, warming the earth.

    Burning coal produces more carbon dioxide than burning oil or gas. It also produces

    sulphurdioxide, a gas that contributes to acid rain. We can reduce this before releasing the waist

    gases into the atmosphere.

    Mining coal can be difficult and dangerous. Strip mining destroys large areas of the landscape.

    Coal-fired power station need huge amount of fuel which means train-loads of coal almost

    constantly. In order to cope with changing demands for power, the station needs reserves. This

    means covering a large area of country side next to the power station which piles of coal.

    Nuclear power energy from spli tting of uranium atoms:

    Nuclear power is generated using uranium, which is metal mined in various parts of the world.The first large scale nuclear power station opened at Calder hall in Cambria, England, in 1956.

    Some military ships and submarines have nuclear power plants for engines. Nuclear power

    produces around 11% of the worlds total energy needs, and produces huge amount of energy

    from small amounts of fuels, without the pollution that you will get from burning fossil fuels.

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    Advantages

    Nuclear energy costs about the same as coal, so it is not expensive to make. Does not produce smoke or carbon dioxide, so it does not contribute to greenhouse

    effect.

    Produces huge amount of energy from small amounts of fuels Produces small amount of waste. Nuclear energy is reliable.

    Disadvantages

    Although not much waste is produced, it is very, very dangerous. It must be sealed upand berried for many years to allow the radioactivity to die away

    Nuclear energy is reliable, but a lat of money has to be spent on safetyif it does gowrong, a nuclear reaction may be a major disaster. People are increasingly concerned

    about thisin 1990s nuclear power was the fastest growing source of power in much of

    the world. In 2005 it was the second slowest-growing

    Renewable Energy

    Tidal power energy from the sea:The tide moves a huge amount of water eachday, and harnessing it could provide a great deal of energyaround 20% of Britains need.

    Although the energy supply is reliable and plentiful, converting it to useful electrical power is

    not easy. There are eight main sites around Britain where tidal power stations could usefully be

    built, including the Severn, Dee, Solway and Humber estuaries. Only around 20 sites in the

    world have been identified as possible tidal power stations

    Advantages

    Once you have built it tidal power is free. It produces no greenhouse gases or other waste. It needs no fuel. It produces electricity reliably. Not expensive to maintain. Tides are totally predictable.

    Offshore turbines and vertical-axis turbines are not ruinously expensive to build and donot have a large environmental impact.

    Disadvantages

    A barrage across an estuary is not very expensive to build, and effects a very wide areathe environment is changed for many miles upstream and downstream. Many birds rely

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    on the tide uncovering the mud flats so that they can feed. There are few suitable sites for

    tidal barrages. Only provides power for around 10 hours each day, when the tide is actually moving in

    or outWave power-energy from the wind on the sea:

    Ocean waves are caused by the wind as it blows across the sea. Waves are a powerful source of

    energy. The problem is not it is not easy to harness this energy and convert it into electricity in

    large amounts. Thus wave power stations are rare.

    Advantages

    The energy is free no fuel needed, no waste produced. Not expensive to operate and maintain. Can produce deal of energy.

    Disadvantages

    Depends on the waves-sometimes youll get loads of energy, sometime nothing Needs a suitable site, where waves are consistently strong. Some designs are noisy Must be able to withstand very rough weather.

    Biomassenergy from organic material:

    Wood was once our main fuel. We burned it to heat our homes and cook our food. Wood still

    provides a small percentage of energy we use, but its importance as an energy source is

    dwinkling. Sugar cane is grown in some areas and can be fermented to make alcohol, which can

    be burned to generate power in the same way. Bioconversion uses plant and animal wastes to

    produce fuels such as methanol, corn and other wastes.

    Advantages

    It makes sense stop use waste material where we can. The fuels tend to be cheap Less demand on the earth resources.

    Disadvantages

    Collecting the wastes in sufficient quantities can be difficult. We burn the fuel, so it makes greenhouse gases.

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    Some waste materials are not available all year round. Geothermal Energy is energy from heat inside the earth;

    The Centre of the earth is around 6000 degree Celsius. In volcanic area, molten rocks can bevery close to surface. The name geothermal comes from the Greek word goemeans earth and

    thermal means heat.

    Advantages

    Geothermal energy does not produce any pollution and does not contribute to effect. The power station does not take up much room .so there is much impact on the

    environment.

    No fuel is needed Once you have built a geothermal power station, the energy is almost free. It may need a

    little energy to run a pump.

    Disadvantages

    The big problem is that there are not many places where you can build geothermal powerstation

    You need hot rocks of a suitable type, a depth where we can drill down to them. The type of rock above is important, it must be a type that we can warily drill through.

    Hydro-Electric power is generated fr om fal li ng water :

    We have used running water as an energy source for thousands of years, mainly to grind corn.

    The first use of water to generate electricity was in 1882 on the Fox River, in the USA, which

    produced enough power to light two paper mills and a house. Nowadays there are many hydro-

    electric power stations, providing around 20% of the worlds electricity. The name comes from

    hydro, the Greek word for water.

    ADVANTAGES

    Once the dam is built, the energy is virtually free.

    No waste or pollution produce Much more reliable than wind, solar or wave power. Water can be stored above the dam ready to cope with peaks in demand. Hydro-electric power station can increase to full power very quickly, unlike other power

    stations.

    Electricity can be generated constantly.

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    DISADVANTAGES

    The dams are very expensive to build however, many dams are also used or flood controlor irrigation, so building costs can be shared.

    Building a large dam will flood a very large area upstream, causing problems for animalthat used to live there.

    Finding a suitable site can be difficultthe impact on residents and the environment maybe unacceptable.

    Water quality quantity downstream can be affected, which can have impact on plant.

    Pumped Storage Reservoirsstoring energy to cope with big demand:

    Pumped storage reservoirs arent really a means of generating electrical power. Theyrea way of

    1 energy so that we can realize it quickly when we need it. Demand for electric power changes

    throughout the day, for example, when a popular TV program finishes a huge number of people

    go out to the kitchen to put the kettle on causing a sudden peak in demand. If power stations

    don`t generate more power immediately, there`ll be power cuts around the country-traffic lights

    will go out, causing accidents, and all sorts of other trouble will occur.

    The problem is that most of our power is generated by fossil fuel power stations, which take half

    an hour or so to crank themselves up to full power. Nuclear power stations take much longer.

    We need something that can go from nothing to full power immediately, and keep us supplied

    for around half an hour until the other power stations catch up. Pumped storage reservoirs are the

    answer we`ve chosen.

    ADVANTAGES

    Without some means of storing energy for quick release, we`d be in trouble. Little effect on the landscape No pollution or waste

    DISADVANTAGES

    Expensive to build. Once it`s used, you can`t use it again until you`ve pumped the water back up. Good planning can get around this problem.

    SOLAR POWER IS ENERGY FROM THE SUN:we`ve used the sun for drying clothes and food for thousands of years, but only recently have we

    been able to use for generating power. The sun is 150 million kilometers away, and is amazingly

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    powerful. just the tiny fraction of the suns energy that hit the earth(around a hundredth of a

    millionth of a percent ) is enough to meet all power needs many times over.

    In fact, every minute, enough energy arrives at the earth to meet our demands for a whole year-if

    only we could harness it properly.

    ADVANTAGES

    Solar energy is freeit needs no fuel and produces no waste or pollution. In sunny countries, solar power can be used where there is no easy way to get electricity

    to remote place.

    Handy for low-power uses such as solar powered garden lights and battery chargers

    DISADVANTAGES

    Does not work at night. Very expensive to build solar power stations. Solar cell cost a great deal compared to the amount of electricity theyll produce in their

    life time.

    Can be unreliable unless you are in a very summer climate in the united kingdom, solarpower is not much use except for low power applications, as you need a very large area

    of solar penal to get a descent amount of power.

    WIND POWER ENERGY FROM THE AI R:We have used wind as energy

    source for a long time. The Babylonians and Chinese were using wind power to pump water

    from irrigating crops 4000 years ago and sailing boats were around long before that.

    Wind power was used in the middle ages in Europe to grind corn, which is where the term

    windmill comes from.

    ADVANTAGES

    Wind is free wind farm needs no fuel. Produces no waste or greenhouse gases The land beneath can usually still be used for farming. Wind farm can be tourist attractions. A good method of supplying energy to remote areas.

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    DISADVANTAGES

    The wind is not always predictable-some day have no wind. Suitable areas for wind farms are often near the coast, where land is expensive. Some people feel that covering the landscape with these towers is unsightly. Can kill birds-migrating flocks tend to like strong winds. Can effect television reception if you have live nearby Can be noisy wind generators have a reputation for making a constant, low swooshing

    noisy day and night. This can drive you nuts an entire wind farm makes quite a racket.

    BIO FEULS:

    Natural, renewable recourses such as vegetable oils and recycled restaurant greases can be

    chemically transformed into clean burning bio diesel fuels. its also safe for the environment

    ,biodegrade , and produces significantly less air pollution than diesel fuel. It even smells better

    than diesel fuel it smells like French fries, donut, or barbecue.

    FEUL ETHANOL:ethanol is a liquid derived from sugar grains other agriculture

    products and wastes. This liquid can be used as high octane fuel in vehicles. Ethanol is consumed

    as fuel in us as gasohol a blend containing 10% ethanol and 90% gasoline by volume. An other

    blend of ethanol called e85 (85% ethanol & 15 % gasoline) is also being used, and number of

    vehicles using ethanol is increasing in USA.

    ADVANTAGES

    They are good renewable resources, each crop can replenish the stock of the fuel Adds the lubricity back into the fuel :low sulfur and ultra low sulfur diesel require

    lubricity while bio diesel is a totally renewable additive for this role and complements

    Bio phase is easy to phase in and out, so you can maintain flexibility in technologydeployment. it can be blended in with existing fuel to create various mixtures

    Bio fuel solvency, higher cetane/octane number and increased lubricity means longerengine life and excellent engine performance

    Bio fuel cuts air toxic exhaust emissions and particulates by more than 50% and sulfur upto 100% depending on the blend at the same time, it minimizes black smoke and odor

    lowering greenhouse gas emission and acid rain.

    Easier to handle and does not require mechanics to use barrier cream on their hands toprotect the skin from cracking or redness.

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    Degrades about 4 times faster than petroleum after spillage with most of a spill brokendown after just 28 days

    Disadvantages

    Ethanol can also be used for drinking purposes. Cold starting problem with use of bio diesel. Bio fuels cannot be stored for more than six months. Scaling, injector chocking, moisture problem with use of bio fuels.

    Global Energy Cri sis:

    In the near future, a reduced availability of primary resources as well as environmental,

    ecological, social and political issues will have major effects on rural development. Escalatingcosts of fossil fuel will precipitate a cascade of environmental, economical, political and cultural

    changes for which society is unprepared. The energy supply demand deficit has the potential to

    eclipse climate changes as the driving force for sustainable development. Planet Earth is under a

    number of interacting stresses brought about by human activity. If humans are to continue to

    developor merely exist a major adjustment of peoples activities will be needed. Major stresses

    include.

    Pollution and climate change with potentially abrupt environmental warming;

    Scarcity of fuel or renewable energy that can be harnessed to replace fossil fuels: oilproduction will peak(or has peaked )and world supplies will start to decline with massive

    effects on human activity

    Scarcity of water;60% of worlds people are likely tohave in sufficient water by 2025 Water for irrigation will limit food production Loss of biodiversity and extinction of large number of organism A continuing population increase, mainly in the resources poor countries

    Over the past 20 years, global warming has become increasingly recognized as potentially the

    greatest threat to the well being of human. However, the phenomena known as peak oil barely

    recognized or struck in the too hard basket by politician, scientist and world leads is nowcreating shock waves through economy. In the short term, the outcome from peak oil may reduce

    the commitment by governments to green house gas abatement policies. It appeals that the

    potentially high cost of energy will become a major driving force for sustainable development.

    As many aspects of human life are dependent on liquid fuel sources, the out coming oil crisis

    will affect all segments of a countries economy and in particular on agriculture and animal

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    forming. The decline in available fuel and the subsequent rise in price will appreciate a cascade

    of environmental, economic, political and cultural change for which we are unprepared.

    Fossil fuel reserve s were deposited from the residues of algae growing in warm shallow seas

    followed by burial as the sea floor sank and the debris was hitted by earths seat flow over

    hundred of thousands of years. World oil deposits occur in only a few of the potentially oil-bearing geological provinces. Most of these areas

    Have been mapped and there is reliable information on state of world reserve before exploitation

    and at the present time. World total oil resources other then those in inaccessible deep-sea areas

    or in time sand are estimated to be close to 2000 billion barrels. These calculations are based on

    oil that already been extracted plus estimated reserves in known fields and a prediction of field s

    yet to discovered. The yet to be discovered oil will be in the most difficult sites to mine and

    therefore this oil is recognized as a high priced resources. There are potentially 300 billion

    barrels of oil in tar sands and shale deposits, mainly in the USA and Canada. exploitation of this

    non-conventional oils difficult and hazardous, as it requires a lot amount of water is energyexpensive to extract an is highly polluting. It would appear that two barrels of oil are required to

    extract three barrels of oil from shale deposits effectively. These deposits will certainly be mined

    in the future but with a long lead time. Optimistic estimates suggested that shale oil will be a

    two billion oil per day industry

    Energy Cri sis in Pakistan:

    Pakistans energy consumption has nearly tripled in the last 20 years, From 0.6 quadrillion Btu to

    1.9 quads in 2001.Still Pakistan account for less than 0.5% on the total world energy

    consumption. In term of per capita energy consumption Pakistanslevel of 12.9 million in 2001

    was higher than Bangladeshs(3.7millionBtu),but virtually on par with India(12.6million).In

    comparison chinas per capita energy consumption in 2001 was 30.9 million Btu, Iranswas 80.3

    million Btu, and Russia was 195.3 million Btu, while US per capita consumption was 341.8

    million Btu. As industries have expanded, factories have excreted more and more toxic effluence

    in to the air .Also as in other developing countries, the numbers of vehicles in Pakistan has

    swelled in recent years..from 680,000 in 1980 to 5 million in 2003.The 1992 Pakistan

    conservation strategy report claims that Pakistani vehicle emits 25 times as carbon dioxide as the

    average US vehicle ,as well as 20 times as many hydrocarbons as and more than 3.5 times asmany nitrous oxide in gram per kilometer. Cars are the leading source of air pollution and

    adversely affect Pakistan economy and population. Economic damages from urban air pollution

    are estimated about $370 million with 6.4 million people get hospitalized annually for air

    pollution related illnesses. A recent advertisement placed by the government in a newspaper

    warned, Takecare of your tune ups before the poison in the air takes care of you.Many

    Pakistani environmentalists say that poor fuel quality is also to blame for the countries serious air

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    pollution problem. Fuel consumption rose by 188%in Pakistan form 1980 to 1998,and gasoline

    continues to contain high level of lead and sulphurs. Unleaded gasoline introduced in 2001, but

    many vehicles in Pakistansmajor cities use leaded fuel gasoline. Various grades of gasoline

    sold contain about350mg/liter of lead --in comparison, unleaded gasoline contains about

    150mg/liter of lead. Energy generation and combustion activities in Pakistan are the most

    significant contributor to Pakistans green houseeffect emissions, accounting for about 70,000

    Gg or approximately 60%of totals estimated emissions in the country. Emissions form the fossil

    fuels comprises the vast majority of these emissions, while releases of carbon dioxide from the

    fossil fuel combustion account for 66.298 Gg. The production, transmissions, storage and

    distribution of fossil fuels also emit green house gases (primarily methane )and are termed as

    fugitive emission from natural gas system, oil productions/refining and local mining. These gases

    represent a much smaller portion of the total energy emissions than CO but are, nonetheless,

    important. More than 85% energy in Pakistan is produced using the fossil fuels, primarily natural

    gas and petroleum. The remaining 15% consists of renewable or other energy sources like

    hydropower, biomass and nuclear energy.

    Energy source Emission level %

    Oil 39.2

    Gas 38.0

    Coal 7.7

    Nuclear/renewable/other 15.1

    Total 100

    The energy related emissions can be significantly reduced through the

    implementation of programs that reduce energy consumptions and there by reduce the resultingemissions proportionality; as well as improve the efficiency of compulsion and as a RESULT

    reduce emission by a factor much possibly much larger than the percentage reduction in energy

    use. The impact of both of these effects airs increased profits or lowers the cost. In addition to

    the direct reduction in emissions energy efficiency programs also promotes environmental

    protection by greatly enhancing awareness of the concept of conservation; by training and

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    education of engineers and technicians regarding more efficient management practices and by

    developing policies which promote rational pricing of energy.

    Pakistan obtain its energy requirements from a variety of traditional and

    commercial sources.oil supply from indigenous sources has as been the weakest link in the

    energy supply system of Pakistan. Until early 1980, production of crude oil was a nominal of13000 barrels per day, which rose to 64349 barrels in 1990-1991.Since then the production is

    continually declining. The remaining oil barrels are estimated to be about 221 million barrels

    which , on the average production rate of 57,000 barrels per day will be exhausted in next 10

    years. Consequently it seems as if Pakistan will remain the importer of the crude oil and refined

    oil products unless a major discovery of oil crude oil is made. The total primary consumption in

    Pakistan is estimated about 60 billion tons of oil equivalent (MTOE).Of this ,two third are met

    by commercial energy sources with about one third being based on non-commercial energy

    sources like the fire wood, charcoal and cow dung. The primary commercial consumption of

    41.7 (MTOE) is largely based on the use of hydrocarbons.

    Source of commercial energy Primary energy supplies (%)

    Gas 38.61

    Oil 42.8

    Coal 5.2

    Hydro 13.0

    Nuclear and other 0.2

    Table: Primary energy supplies by source

    Oil and gas account for more than three-quarters of the commercial energy consumption in the

    country .Gas has emerged over the years as the leading domestic source of the energy. Pakistan

    has appreciable coal reserves of 1.7 billion tones of oil equivalent (TOE). Oil is by and large an

    imported source of energy. The imports of oil account for 85% of oil consumption in the country

    and 42.8% of commercial energy consumption. The product of indigenous oil 9is around 15% of

    total imports of oil products, which is likely to remain the case. Pakistani oil sector performance,

    unlike of that natural gas sector, has not been satisfactory, both by the way of exploration,

    exploitation and development of oil fields , and by way of refining of crude oil into various

    products, with that result 70% of total demand of crude oil is being through products. I cost

    about US$ 2.5 billion every year to import about 18 million tons of oil as both crude and refined

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    products, resulting a great burden on foreign exchange resources. No significant new discovery

    of oil has been reported in the recent past. Of course efforts are underway both by national and

    international exploration and development companies to make new oil discoveries. Transport,

    power and industry are the major oil consuming sectors of the economy.

    Sect oral consumption%

    Transport 47.2

    Power 33.2

    Industry 12.9

    Agriculture 1.5

    Domestic 3.0

    Other Govt. 2.3

    Sect oral consumption

    Today, the total energy supplies are not enough to meet even the present demand. So, Pakistan,

    like other developing countries of the region, is facing a serious challenge of energy deficit.

    Renewable energy sources can play an important role in meeting this challenge.

    OIL:Pakistan produce 6,1769 barrels per day (bbl/d) of oil in 2003(of which 60,000 bbl/d

    was crude oil) , and consumed 36,000 bbl/d of petroleum products . Net oil imports were

    308,000 bbl/d in 2003. While there is no prospect for Pakistan to reach self sufficiency in oil, the

    govt. has encouraged private firm to develop domestic production capacity. Pakistani domesticoil production centers on the Potwar Plateau in Punjab and lower Sindh province.

    State-owned oil and Gas Development Corporation Limited (OGDCL) is a leading firm in the

    industry, producing around 22,334 bbl/d according to company

    Information. a 5% stake was sold in public offering in November 2003 for approximately $119

    million. ODGCL is Pakistanssecond-largest oil producer after UK based BP. The government

    will also offer a stake of up to 15% of Pakistan. Petroleum limited (PPL), the largest exploration

    and production firm in Pakistan. Currently the government controls 93% of the company, which

    owes to Sui fields in Balochistan , as well as exploration interests in 22 blocks. The governmentalso has a 355 stake in Pakistan Oilfields Limited (POL).

    Oil sector reforms in Pakistan are generally on track, but the privatization of several firms,

    including Pakistan State Oil (PSO) , continues to be postponed. The governmentsdivestiture of

    its 51% stake in PSO holds a 60% domestic market share in diesel fuel and has more than 3750

    outlets. Deregulation of prices for petroleum products is being pursuit in parallel with the

    privatization of PSO.

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    As part of the countrysprivatization process, Pakistan is setting up a Gas Regulatory

    Authority (GRA) and the petroleum Regulatory Board (PRB), which will separate out

    government functions from state-owned companies to be privatized. Pakistans government

    hopes to reap significant revenues from these privatizations over the next several years. The two

    most significant foreign oil firms in Pakistan are BP and ENI.BP operates 43 fields in Pakistan

    and had reported average production of 25877 bbl/p in 2003. Other firms include BHP Billiton

    (Australia), OMV (Austria), PETRONAS (Malaysia) and Premier Oil (UK).

    Pakistans net oil imports are projected to rise substantially in coming years as demand growth

    outpaces increase in production. Demand for refined petroleum products also greatly exceeds

    domestic oil refining capacity, so nearly half of Pakistani imports are refined products.

    Pakistans Pak Arab Refinery (PARCO) became operational in late 2000, adding to the

    countrys refining capacity and alleviating refined product import dependence. The PARCO Mid

    Country Refinery at Mahmoodkot was formally commissioned in 2001 and has capacity of

    100,000 bbl/d of throughput (mostly crude oil from Abu Dhabi and Light Arabian Crude from

    Saudi Arabia, supplied to the plant by the pipeline from Karachi.

    A small, 30,000 bbl/d refinery operated by private Bosicor Pakistan Limited (BPL) near Karachi

    began commercial operation in November 2003. The plant is supplied with shipments of crude

    oil from Qatar. The Bosicor plant will allow Pakistan to become a new supplier of naphtha to far

    eastern markets. Naphtha makes up approximately 9% of the plants output. The plant produces

    about 10800 bbl/d of fuel oil, 6980 bbl/d of diesel and 4350 bbl/d of kerosene and among other

    products. PSO has a supply contract to purchase a totality of the Bosicor Refineries products for

    the next 10 years.

    Another major planned project is Iran Pak refinery, which would have a capacity of 130,000bbl/d. The refinery will be located near the border with Iran in Balochistan and would be a 50:50

    partnership between Pakistans Petroleum Refining and Petrochemical Corporation (PERAC)

    and the National Iranian Oil

    Company (NIOC). Oil processed at the Iran-Pak refinery would come almost exclusively by sea

    from Iran and would be unloaded at a terminal to be built for the refinery. The project has failed

    to reach financial closure; however, as NIOCs demand coal guaranteed rate of return is at odds

    with Pakistans policy against such guarantees.

    Nuclear energy:a small (125 Mwe) PHWR plant was commissioned in 1971. Known asKnupp (Karachi Nuclear Power Plant) , this facility makes a minor contribution ( less than 1% )

    to national electricity supply. In addition, a 2ndplant (Chasnupp 1), a300 MWE PWR, has been

    constructed at chasma; it was connected to the grid in June 2000.palns are reported for a second

    unit at chasma, to be operational in about2009: negotiations with china on its construction were

    under way in may 2001.

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    The Karachi facility which was build in 1965 with Canadian assistance, as demonstrated a poor

    operating record, which in addition to concerns in the international community about Pakistans

    possible use of nuclear material for weapons has contributed to lack of further development of

    the countrys nuclear power sector . the Chasma Nuclear Power Plant was built with Chineseassistance and inaugurated in 2001.Pakistan is placing more emphasis on nuclear power to meet

    future energy need and has began talks with chin over the development of a second facility at

    Chasma.

    Natural Gas:

    Pakistan has 26.8 trillion feet (Tef) of proven gas reserves, and currently produces around 0.8

    Tef of natural gas per year, all of which is consume domestically. Natural gas producers include

    Pakistani state-owned companies Pakistan petroleum ltd.(PPL) and Oil and gas development

    cooperation(OGDCL),as well as BP , Eni ,OMV and BHP. As part of its energy sector reform

    program , the govt. is committed to privatizing a 15% stack of PPL(see above),the largest gas

    producer in the country, capable of producing 770 million cubic feet per day(Mmcfd).the largest

    currently productive feet are sui, by far the largest at 650Mmcfd ,Adhi and Kand khot

    (120Mmcfd), Mari and Kandanwari.

    Pakistans demand fornatural gas is expected to rise substantially in the next few years , with an

    increase of roughly 50% by 2006, according to Pakistans oil and gas ministry. Pakistan also

    plans to make gas the fuel of choice for future electric power generation projects, hoping to

    substitute domestic gas supplies for imported foreign oil. This will necessitate a sharp rise in

    production of natural gas, and also has generated interest in Pakistan in pipe lines to facilitate

    imports from neighboring countries.

    Development of new natural gas fields with the help of foreign investors is proceeding, with

    Pakistan govt. expecting recently discovered fields to add

    About one billion cubic feet per day(Bcfd) to Pakistans natural gas production. Currently , fields

    in productions include sawan at about 366 Mmcfd, buit at about 316Mmcfd, and zamzama in

    Sindh province producing about 248Mmcfd, but possibly able to produce 380 Mmcfd following

    a new gas discovery in January 2004.

    Pakistan govt. restated its willingness to permit a natural gas pipeline linking Irans massive

    reserves to Indian markets across Pakistani territory. Pakistan would earn transit fees for Iranian

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    gas supply to India and also would be able to purchase some gas from pipeline when and if its

    own demand was sufficient. While Iran and Pakistan have shown great interest in the project,

    India has been reluctant to move forward as long as political and military tensions with Pakistan

    over Kashmir persist. The issue was due to be discussed at bilateral talks between India and

    Pakistan in June 2004, although negotiations are still expected to be protected and difficult. Iran

    is offering India that it will cover 60% of the construction costs of the pipeline, but India remain

    vary of Pakistani asses to its energy supply. Indian officials said the plan could be considered if

    Pakistan can provide security guarantees for the $3 billion project. Pakistan could earn about

    $600 annually in transit fees from the pipeline.

    Another natural gas import possibility is an eventual link with dolphin project, a scheme to

    supply gas from Qatarsnorth dome gas field to the United Arab Emirates and Oman, via a sub-

    sea pipeline from Oman. Even though Pakistan has signed a preliminary agreement to eventually

    purchase natural gas from Qatar, it remains to be seen how the initial stages of the pipeline

    project go before a route to Pakistan can be conclusively negotiated.

    ELECTRIC POWER:

    Pakistan has 18 gigawatts(GW) of electrical generating capacity. Thermal plants using oil,

    natural gas and coal account for about 70% of this capacity with hydro electricity(hydro) making

    up 28% nuclear plants 2.5%. Pakistan total power generating capacity has increased rapidly in

    recent years, due largely to foreign investment, leading to a partial alleviation of the power

    shortages Pakistan often faces in peak seasons. Rotating blackouts are still necessary in some

    areas. Transmition losses are about 30%, due to poor quality infrastructure and significantamount of power theft with much iof the Pakistans rural areas yet to receive electric power and

    less than half of the population connected to the national grid, Pakistan has some excess

    generation capacity.

    The electric power sector is state-owned.the main state-owned and utilities are WAPDA,

    KESCO, KEPCO, LESCO together WAPDA and KESCO transmit power half to household and

    rest to industries. Rates are determined by national

    Electric Power Regulatory Authority (Nepra) and disputes over adjustments to rates are common

    within the industry.

    For example, Nepra announced in July 2004 that electricity rates would be lowered for domestic

    , industrial and agricultural customers in the three distribution areas of Hyderabad , Peshawar

    and Quetta. The distribution companies affected complained that due to lower rates , they will be

    unable to cover their operating costs. Nepra has advised the federal government to subsidize the

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    providers at a cost of around $24 million. WAPDA and KESC too blame low rates on weak

    earnings and enormous debts to fuel suppliers. WAPDA is at the centre of a public sector

    circular debtproblem, in which state firms and government ministries have failed to pay power

    bills, and WAPDA has failed to meet obligations to them and to private sector creditors,

    especially state-owed PSO.

    Power theft is a pressing issue in Pakistan. While it is impossible to precisely measure theft (as

    opposed to line loss), it is obvious that it constitutes a sizable proportion of Pakistans over all

    30% loss rate. The situation was so severe by early 1999 that the Pakistani government assigned

    army units to look for illegal connections to transmission lines and rigged meters. Powers theft is

    just one part of the financial problems for WAPDA, however.

    Growth in power generation in recent years has come primarily from new independent power

    producers (IPPs) , some of which have been funded by foreign investors, and a few WAPDA

    hydroelectric dam projects. The two largest private power plant in Pakistan are the hub power

    company (HUBCO) and the Kot Addu power company (KAPCO) . HUBCO is owned by aconsortium of international power (UK), Xenal (SAUDIARABIA) and mitsui corporation, and

    has a 1300 MW capacity. The Kot Addu plant, with a 1600 MW capacity was privatized in 1996

    (From WAPDA), and international power holds a 36% equity stake, while a government holds a

    soon-to-be divested 64% stake. Both of these plants, as well as a few other small private

    operators, sell power to the national grade currently run by WAPDA. BY may 2004,

    international power cut its holding in HUBCO from 26% to 16% after the plant saw a drop in

    profit. This is reportedly part of international powers overall global strategy and not a comment

    on the Pakistani energy sector.

    In April 2003, the ministry of industries and production announced that it was planning to buildcoal-fired power generation plants in export processing zones and in special industrial states to

    provide a less expensive source of energy. Officials hope to exploit the large untapped coal

    reserves in Tharparkar. At present, coal makes up less than a 5 % share in overall energy

    production.

    Plans are also underway to expand Pakistans Hydro capacity, the government approved the

    construction of 4 new Hydro plants to be built in NWFP by 2005/2006, that would generate

    several hundreds MW of additional power. If the $5.5 billion Kalabagh project is approved

    currently it is being held of because of environmental impact and downstream economic impact

    concernsThe new Hydro plant could supply 2400-3600MW of generation.

    Capacity the ghazi barotha hydro pwer plant came online in 2003 at a cost of $2 billion and a

    generation capacity of 1,450MW.

    Thar coal :coal currently play a relatively minor role in Pakistan energy mix ,but the

    discovery of large volumes of low ash ,low _sulphur lignite in the tharparkar desert in Sindh

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    province could increase its importance. Thar reserves are being developed under the

    jurisdiction of the provincial Sindh coal authority and have enormous economic potential .the

    authority is to develop the reserves primarily to fuel large electric power plants to be built in

    tandem with coal mines .a feasibility study recently was carried out fopr the construction of coal

    fired power plant near the thar coal mines ,and government has stated that coal should make up

    more than the current 1% of electricity power generation in Pakistan.

    Table 4: primary Energy mix by country, 2004

    _________________________world_______pakistan____india_______bangal____ china malaysiasi

    Population (million ) 6393 15 1086 141 130 25.6

    Per capit GDP US S S 200 2100 2200 1900 5000 9000

    1994 (ppp)

    Per capit primary 1.55 .30 .32 .11 .91 271

    energy supply (toe)

    Import dependence n.a 24% 18% 21% 1% -53%

    (export)

    Primary Energy mix by country ,2004

    Pakistan india Malaysia UAE UK USA Canada china

    Oil 30.0 35.00 42.0 32.00 35.0 40.0 30. 23.$

    Natural gase 30.0 7.0 51.0 6s.0 35 .0 23.0 27.0 2.6

    Coal 6.5 55.0 4.0 - 16.0 23 24 67

    Others

    (hydearal, 13.5 3.0 3.0 - 14.0 14.0 19.0

    6.6

    Nuclear ,etc)

    Envir onmental Hazard:Pakistan attempt to raise the living standard of its citizens has

    meant that economic development has largely taken precedence over environmental issues.

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    Uncheck use of hazardous chemicals, vehicle emissions and industrial activity has contributed to

    a number of environmental and health hazards, chief among them being water pollution. Much of

    country suffers from a lack of potable water due to industrial waste and agricultural runoff that

    contaminates a drinking water supplies. Poverty and high population growth have aggravated,

    and to of certain extent, caused these environmental problems in cities widespread use of low

    quality fuel, combined with dramatic expansion in the number of vehicle on Pakistani roads, has

    lead to significant air pollution problems. Although Pakistan major air pollutants in urban

    centtert such as Karachi, Lahore and Islamabad. In addition, stress on already stretched supply of

    energy in the country has led to be serious civic responsibility problems. Theft or diversion of

    electricity in transmission, as well as s lack of energy efficiency standard, have contributed to

    Pakistanshigh energy and carbon dioxide intensities.

    Solution to the energy cri sis

    Committed Government:Pakistan have an installed electricity generation capacity of19,222MW , which will produce more than 80,000 GWh of electricity this year(of which 30% is

    in the private sectors). Currently less than 50% of the country has access to electricity and

    therefore, government is committed to further develop this sector in order to promote sustained

    industrial growth.

    The economy hydro power potential in Pakistan is estimated at 20,000 MW, while the country

    existing hydropower generation capacity is 6,46- MW and projects for additional 3,500MW are

    currently under development in public and private sectors. The estimated requirement in

    Pakistan for building mega dams in the next two decades is USD 900 million .the government of

    Pakistan on its part, has also planned on spending similar amount on annual basis for the next 20years. In addition private investors have submitted expressions of interest to gene rate over 9,000

    MW of power required in the next 5,6 years through hydel thermal and coal based projects

    .similarly under a phase program three entire Thermal gene ration which consume major part of

    the imported fuel oil is also being switched over from oil to indengious natural gas.

    The government is currently being spending USD 200 million a year to upgrade the

    existing generation transmission and distribution system. However the water and power

    Development authority (WAPDA) requires funding of USD 5 billion to improve upon the

    existing transmission and distribution network of 360,000 kms in the country. Pakistan also

    possessed an estimated 185 billion tons of coal reserves which are one of the largest in the world.

    Feasibility are also underway for the development of energy of over 1,000MW, through the use

    of and solid waste.

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    Exploration and utilization of alternate sources of power through use of Solar and Wind energy

    has also been initiated in Pakistan. During the last two decades Pakistan has developed it sits

    potential in photovoltaic technology which is suitable for small power and remote area

    applications.

    Clean Fuels Ini tiative;The governments 1995 clean fuel initiative introduce d thepossibility of using alternative fuels for vehicles. As per 2001 200,000 cars were fitted to use

    natural gas which pollutes less than gasoline. The government has also set up 150 CNG fueling

    stations around the country and are looking as well to convert diesel vehicles in CNG .Pakistan

    has investigated converted rickshaws to CNG through a pilot project with the Canadian

    international Development agency Preliminary results suggest converting rickshaws in CNG

    will bring considerable cost saving s for rickshaw owners and environmental benefits throughout

    the country .unfortunately outside funding would be required to expand the program as the

    capital investment to convert rickshaws to CNG is beyond the reach of motor rickshaws owners.

    Renewable Energy;Renewable energy consumed in Pakistan in 1997 totaled 1,132

    trillion Btu a 1% increase from 1996.hydroelectric power is an important domestic energy source

    generating 28% of all electricity in the country and a number of new sites are being developed.

    Although the mountainous north gives Pakistan much hydroelectric potential difficulty of access

    and a high cost of transmission to the populous north make development of this potential a

    distant prospect. Nevertheless the Pakistani government has started working on feasibility study

    for the construction of more dams with feasibility reports of least five small dams expected to be

    completed by the end of 2000.

    Indeed, some development of renewable energy sources has been undertaken precisely becauseof the population difficulty of access. In order to provide electricity to rural areas that would

    otherwise not have electricity foreseeable future ,Pakistan is turning into solar power .Pakistan

    has worked with World Water, American company to install solar powered water pumps that can

    help address the water needs of people in rural areas without electricity. The government hopes

    that by harnessing solar power for energy in rural areas it would reduce villages reliance on

    firewood, dung, bagasse making up for onethird all energy consumed in Pakistan. Although

    Pakistan is an ideal physical environment for solar energy, many projects have failed because of

    the system needed maintenance after expert personal had left. Studies are underway on how

    future solar projects can be sustained at local level by Pakistani villages.

    National energy conservation center (ENERCON)to capture the substantial

    economic benefits provided by conserving energy the Government of Pakistan established the

    ENERCON as a permanent energy to serve as a focal point for all energy conservation activities

    , including policy formulation .ENERCON is

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    Dedicated to conduct and undertake energy conservation activities in Pakistan. The main

    program areas consist of energy conservation in industry and power sector, agriculture, buildings

    and road transport sector. Through the implementation of its wide ranging-activities, the

    ENERCON has made significant contributions to the development of the energy conservation

    technology and has achieved a significant energy saving potential in various sectors of economy

    of Pakistan. The impact has been direct and indirect, quantitative and qualitative. ENERCONs

    programs provide a comprehensive unified approach to energy conservation. In a short period of

    its inception, ENERCON has:

    Created awareness regarding the cost-effectiveness and potential for energy savings; Provide that energy conservation is the cheapest and most readily available source of

    additional supply of energy in Pakistan and;

    Demonstrated that simple measures implemented on a nation-wide scale can achievelarge savings quickly and at the fraction of the cost of new supplies.

    Research and Development: Renewable energy systems are expensive in terms of

    installation costs. The power from them is also available intermittently- when the renewable

    source is available. On the other hand, they are free of any input fuel, and hence their ever rising

    costs. They also incur much less operation and maintenance costs and are supposed to have a

    longer lifetime. Thus, using renewable power looks uneconomical in the short term, but may turn

    out profitable in the long term. Therefore ,the key question is what can make investment in

    renewable power generation acceptable ?The creation of Pakistan Council of Renewable Energy

    Technology in 1990, and later the creation of Alternate Energy Development Board in 2003 have

    kept the potential and hopes of developing renewable energy alive.

    In addition, the energy group at SDPI is conducting research to find answers to this

    question through a financial analysis ,which looks at the costs involved insetting up renewable

    power business in Pakistan and in identifying factors that can help attracts investment in the

    renewable technologies .The research especially focuses on finding out the cost of renewable

    power generation and then on determining a suitable tariff that is acceptable both to the

    prospective investor and electricity purchasers in the country.

    Coal exploi tation:The government of Pakistan is strongly emphasizing a wide use of the

    vast deposits of the coal found in the desert oh Thar . It is planning to provide incentives to

    independent power producers to setup production plant at the mine site and to sell electricity tothe national grid. It is also urging cement industries all over the country to use this coal.

    However, the coal, low quality lignite, is known to contain significant sulphur concentrations.

    Extensive use of this coal is, therefore, likely to substainlly increase environmental degradation

    ,particularly when used in cement plants situated near cities and towns. Any future use of the

    Thar coal demands.