Tawanai

Merril Lynch issues regular updates on the macroeconomic conditions in the country. Here is what they wrote about the oil and gas industry situation in the December 24th update.

Drilling activity is slow to pick up in 1HFY09. Only four exploration and two development wells were drilled up to November, according to PPIS, relative to the full-year target of 40 and 50 wells, respectively. The full-year drilling target is likely to be revised down.

Relative to its peers, production surprises are limited for PPL. The expected production growth of 2-3% in
FY09 depends on completion of phase II expansion phase on Tal block.

Gas, Investment, Oil, Pakistan

Ye load shedding nahee, load sharing hai

The above line is taken from a comment to this post by Jauhar Ismail. He writes at Pakistaniat.com.

Notwithstanding the systemic issues such as the failure to build new dams and previous Government’s inability to add even a single megawatt of new power to the grid during 9 years of its rule, it seems that the present crisis is a result of bad management and the lack of foresight. The total installed capacity of WAPDA and KESC totals around 19,500 megawatts. Almost two third of this power comes from thermal power plants (fossil fuels), one third is generated by water and about 2% comes from nuclear power plants.

The demand for electricity in Pakistan during the winter months actually goes down and this winter has not been an exception. Throughout the month of December, the electricity consumption in Pakistan hovered around 11,000 MW, down from the peak levels of 17,500 MW seen in summer. This demand was well within the installed capacity of WAPDA & KESC yet they were only generating a meager one third (6500MW) of their maximum capacity during this period leaving a huge gap between supply and demand. Their are two main reasons for this:

1. The water flow from all major dams was halted starting mid December to allow the annual cleaning of canals in January. This action effectively took all the hydro power off line.

2. The thermal power plants were working far below their potential due to the lack of money caused by the circular debt between various government agencies reaching a staggering 400 billion Rupees.

Consumers, Electricity, Energy

State of Telecom in Pakistan has a good post about telecom’s role in conserving energy and saving money.

Last year we saw Telenor and Warid vie in the media as the first one to install solar base stations. That was a start and the trend for green, renewable and more efficient solutions will continue. There is a lot more work to be done in the energy conservation and alternative reneable sources of energy for the technology and telecom industry. The infrastructure elements such as base stations consume significant energy and the data centers needed to run the IT operations are also major energy spenders. The infrastructure sharing idea promoted in Pakistan was also a good point in theory but its actual success has not been reported yet.

Typically, around half of the operating expenditure of a network company is spent on electricity, according to Ericsson. The proportion tends to be higher for operators in the developing world because their base-stations may be in remote areas, and therefore require diesel-fuelled generators. So the recent spike in energy prices has prompted operators to look for ways to cut costs.

The Economist ran a story about green telecom networks and ways to conserve energy in the telecom world. Good tips for saving energy from Economist.com include:

There are some relatively simple ways to reduce the energy consumption of a base-station. The first is to turn down the air-conditioning. Many mobile operators now run base-stations at a standard temperature of 35ºC, rather than the previous norm of 25-30ºC. Studies show that the higher temperature does not reduce the equipment’s reliability or life expectancy. “The biggest restriction is actually our technicians, who do not like going into the hut to work at 35 degrees,” says Andy MacLeod, Vodafone’s global networks director.

Operating at this temperature means ambient air can be used for cooling, even in hot countries. An air-filter is installed on one side of the cabin, and a fan is installed on the other, resulting in a steady flow of air. Vodafone plans to replace air-conditioning with this simpler approach, called “freecooling”, in the majority of its base-stations over the next three years, as part of a plan to reduce its carbon footprint by 50% between 2006 and 2020.

Conservation, Electricity, Energy, Environment, Green, Infrastructure Pakistan, telecom

Google Zeitegest has interseting trends based on how people search. Consider the recent search trend for green and renewable energy – mainly these were driven by the increase in gas prices. The chart below shows the timeline for solar panel, hybrid car and cfl from Google for 2008.

Energy, Renewable Energy, Solar

Hurray … no more unscheduled load shedding! It is amazing what humans start perceiving as ”better” after they have been subjected to really bad conditions. Once you have heavy suffered unscheduled load shedding for months,  then even the scheduled load shedding starts looking so much better. Reported in media:

There will be no more unannounced power load-shedding across the country from Saturday night, Spokesman of Pakistan Electric Power Company (Pepco) Tahir Basharat Cheema assured on Saturday. Talking to a private TV channel, he said the company has made scheduled load management as its top priority on the directives of President.

Electricity load shedding

Economist ran a report on technology and featured Wind power. The main points are:

• The potential is huge and price is cheap
• Technology has improved hugely over the years
• Scale matters. Larger turbines are better
• Challenge is how to transport the produced energy frm wind to consumers

Wind power is attractive because it is a widely available and renewable source of energy that produces neither pollution nor climate-changing greenhouse gases. Once the turbines have been installed, the only “fuel” they need is the wind. And global wind resources are so vast that they could easily meet the world’s current energy needs, at least in theory. Wind generates only about 1% of all electricity globally, it provides a respectable portion in several European countries. According to a study by researchers at Stanford University, global wind-energy potential in 2000 was about 72,000GW—nearly five times the world’s total energy demand.

About the technology:

When sunlight heats the Earth, it also heats the atmosphere. As hot air rises, cooler, heavier air rushes in to fill its place—thus creating wind. For more than 2,000 years people have captured this energy with windmills and used it to do useful things, such as grind grain or pump water. By the late 19th century, windmills were also being used to produce electricity, mostly in rural areas.

Compared with traditional windmills, however, modern wind turbines are far more efficient. Their rotors are pointed into the wind under computer control, and their blades exploit the phenomenon of aerodynamic “lift” that keeps aeroplanes in the air. Turbine blades are shaped like aerofoils, with one side curved and the other almost flat. This shape causes the air to flow more quickly over the curved side than the flat side, and the fast-moving air results in an area of low pressure on the curved side of the blade, which causes the blade to move and the rotor to turn. The blades are attached to a rotor hub, which is in turn connected to a drive shaft. But this shaft spins quite slowly, so a gearbox is used to get the drive shaft to turn a second shaft at a much higher speed, suitable for spinning a generator to produce electricity. In a wind farm, the electricity from multiple turbines is collected and fed into the grid.

Excerpts from the Economist.com:

The technology needed to tap into this source of energy is getting cheaper: the cost of generating electricity from wind power has fallen from as much as 30 cents per kilowatt hour in the early 1980s to around ten cents in 2007. Various incentives, in the form of tax credits and feed-in tariffs, mean that wind power is already cost-competitive with electricity derived from natural gas and even coal in many markets. With a tax of $30 per tonne of carbon dioxide, says Maria Sicilia of the International Energy Agency (IEA), electricity produced from wind could compete with fossil fuels in most markets even without subsidies.

Despite some difficulties in transporting, deploying and maintaining large turbines, the industry still believes that bigger is better. Onshore machines are creeping up to about 3MW in capacity, and some offshore turbines on the drawing board are more than twice as powerful.

The greatest obstacle to the wider adoption of wind power is the need to overhaul the power grid to accommodate it. Transmitting wind power from rural areas with strong winds to populated areas with high demand will require expensive new transmission lines. In addition, the power grid must become more flexible, though some progress has already been made. “Although wind is variable, it is also very predictable,” explains Andrew Garrad, the boss of Garrad Hassan, a consultancy in Bristol, England. Wind availability can now be forecast over a 24-hour period with a reasonable degree of accuracy, making it possible to schedule wind power, much like conventional power sources.

Energy, Infrastructure, Renewable Energy, Wind

Pakistan is facing hard time as the shortage of Petroleum and Gasoline has hit the country. From the last couple of weeks there has been an era of difficulty on Industrial, consumer and contractor basis. The economical situation of the country is not stable. With this artifical shortage of petroleum and gas the industries are in trouble. Industrialists fear that they would not be able to meet their orders in time. Many industries are being closed or shut down as a result of these issues. As the price of petrol came down there has been a reverse effect. Petrol stations are closed as government is unable to provide petrol to people. Instead of saving Pakistani government stopped the inflow of petrol into the country. People on the other hand have started making rumours of why there has been such shortage. Some think its going to the military where as some say that its an artificial shortage. On the latest news till now the prime minister has requested Iran to aid Pakistani to meet the oil shortage.

On the other hand Sui Northern Gas Compnay has also limited its supply and then again industries and consumers are paying the price for it. There is a word out these days called “Gas Load Shedding”. The company has failed to provide gas to CNG stations and homes. Shortly after the petrol was available on the filling stations, CNG went out. There was not a single gas station open in Lahore at the day time because of the shortage. The CNG station owners say that out of 15% there is 2% gas available to them which is not a good number. In Lahore CNG stations start there business at the midnight and go till 8 in the morning. Both the domestic consumers and the industrialists have protested heavily against the government.

The oil and gas shortage is a threat to Pakistan’s economic stability. If the industries are shut down there would be no domestic or foreign investment. The stock markets will fall. Government has a limited time barrier to come over these problems or to face heavy damages to the infrastructure of the country.

Consumers, Economics, Energy, Gas, Infrastructure, Investment, Oil, Petrol

Many countries are facing the problem of transporting renewable power from where its generated to where its needed. Pakistan has the similar problem that the wind power may be generated in one part of Sindh while it may be needed in another part. Aging transport infrastructure for power is a serious problem in developed countries as well as developing countries. Probolem: it requires a whole lot of money to build a better infrastructure. Untill we solve this problem, renewable power will not be a reality. See excerpts from this great article in Technology Review.

(There are) immense challenges ahead as power from renewable sources, mainly wind and solar, starts to play a bigger role around the world. To make use of this clean energy, we’ll need more transmission lines that can transport power from one region to another and connect energy-­hungry cities with the remote areas where much of our renewable power is likely to be generated. We’ll also need far smarter controls throughout the distribution system–technologies that can store extra electricity from wind farms in the batteries of plug-in hybrid cars, for example, or remotely turn power-hungry appliances on and off as the energy supply rises and falls.

Researchers at the National Renewable Energy Laboratory in Golden, CO, have concluded that there’s no technical or economic reason why the United States couldn’t get 20 percent of its elec­tricity from wind turbines by 2030. The researchers calculate, however, that reaching this goal would require a $60 billion investment in 12,650 miles of new transmission lines to plug wind farms into the grid and help balance their output with that of other electricity sources and with consumer demand.

Regulation and governance is also a problem. Reading this just seems like we are in Pakistan or India!

The U.S. grid’s regulatory structure is just as antiquated. While the Federal Energy Regulatory Commission (FERC) can approve utilities’ requests for electricity rates and license transmission across state lines, individual states retain control over whether and where major transmission lines actually get built. In the 1990s, many states revised their regulations in an attempt to introduce competition into the energy marketplace.

Another important point is smarter use of technology to reduce waste of energy and increase awareness.

Homeowners are getting software that lets them view and manage their energy consumption on the Web, and some of their appliances are being fitted with switches that will let the utility shut them off remotely during periods of high demand.

Smart-grid technologies could reduce overall electricity consumption by 6 percent and peak demand by as much as 27 percent. The peak-demand reductions alone would save between $175 billion and $332 billion over 20 years.

Infrastructure, Renewable Energy power, transportation