Karachi, July 22, 2022 (PPI-OT): Pakistan Power: FY22 Power generation: Furnace oil makes a comeback

CPPA-G released its Energy Purchase Data for the month of June. Power generation declined in the month with 13,876GWh being generated, declining by 5%YoY and 3%MoM. Generation for FY22 is 143,169GWh up 10%YoY, compared to 130,188GWh generated in FY21.

The most significant increase in power generation for FY22 has been posted by RFO based plants, with generation up 112%YoY, followed by 70%YoY for nuclear and 58%YoY for wind based generation. On the flipside, generation from Hydel and Coal based generation has decreased by 8%YoY and 4%YoY respectively.

The average cost of generation for Jun’22 has risen to PkR14.7/kWh up 12%MoM/160%YoY, mainly due the increase in generation from RFO which has hit an all-time high cost of generation of PkR36.2/unit, along with RLNG which has cost PkR28.4/unit. Due to rising fuel costs globally, average cost of generation has risen by 93% in FY22 to reach PkR9.3/kWh compared to PkR4.8/kWh in FY21.

In FY22, HUBC has seen a surge in generation by 5.3% cumulatively across all four plants. KAPCO’s generation has increased by 27%YoY, while NPL/NCPL have increases in generations by 52% and 118% respectively. Going forward, uncertainty remains regarding coal based generation along with RLNG availability. It remains to be seen if utilization of RFO based IPPS remains elevated in FY23, as furnace oil has established itself as the go-to fuel to pick up the slack when generation from other fuels remains compromised.