Having access to electricity is considered to be one of the most important services in fighting poverty and improving the welfare of individual citizens. In the digital age, it is difficult to visualize development without electricity. Apart from the availability of energy, change in the quality of energy is one of the most important drivers of productivity. This quality of energy is not constant across the world, resulting in load shedding in developing and emerging markets.
In advanced economies we are used to always have electricity. As long as we have an energy plan and we pay our energy bills every month we are fine.
Imagine this: You’ve paid your $100 energy bill, but for some reason you don’t have access to electricity all the time. You call up the electricity company and they tell you; ‘‘Oh yes, that’s right... Too many people are making use of the electricity so we had to cut some of you off including you. But don’t worry, it will be back up in a few hours and just so you know... we will do it again next week.” This is load shedding.
What is Load Shedding?
Load shedding happens when there is not enough electricity available to meet the demand of all customers, and an electricity (public) utility will interrupt the energy supply to certain areas. It is a last resort to balance electricity supply and demand. Most companies try to do it on the basis of load-shedding schedules to enable their customers to be better prepared in the event of load shedding, which is called rotational load shedding.
Rotational load shedding is more common in developing countries, because the electricity grid is underfunded, outdated or the infrastructure is not properly managed. However, it can happen in developed countries as well. For example, in the Canadian province of Newfoundland & Labrador they instituted rotational load shedding after a fire at a substation following a blizzard. This rotational load shedding was caused by extreme cold weather and a high demand for the power at the time. The blackouts were rolled fairly rapidly so that no area had to spend more than one hour without power.
The Consequences of Load Shedding
Even though load shedding happens to stop the entire country from experiencing a permanent blackout (by the collapsing of the whole electricity supply grid) load shedding still has major negative effects on the economy in a country.
For example, in South Africa where load shedding has become a reality since December 2014, it has already impacted the economy and the economy will only grow by 2%, down from an economic growth forecast of 2.3%. Load shedding has had a big effect on the manufacturing industry where manufacturing production was affected more than any other factor, because of the decline in business activity.
In South Africa this used to only happen a few times a year during peak hours from 5:00 pm till 9:00 pm, but it has been increasing in the past months. In other countries such as Zambia and India, it can take up to 10 hours if not more a day. Quantum Minerals, a mining company active in Zambia, will lay off around 1,480 workers at one of its Zambian copper projects after a reduction in their power supply limited the production. Even after this the government in Zambia still claims that load shedding will have no impact on the mines or Net Domestic Product.
Light at the end of the Tunnel
Load shedding is a real problem in the developing and emerging markets and takes a big hit on the economy. It is affecting the GDP economic growth and is costing small businesses and corporations billions a year. One of the solutions to lower the amount of load shedding is the use of renewable energy (wind and solar energy) sources. This has showed to be true in South Africa, where if it wasn’t for solar and wind energy even more load shedding would have been implemented.
While countries in the west move towards enlightenment, Pakistan is moving towards darkness. The country suffering at the hands of corrupt politicians and terrorism has much graver problems and one of them is load shedding. It is the 21st century and there is no electricity in Pakistan! People are crying their hearts out in front of the government to provide them with the basic necessity of electricity but
the government seems to have no clue about how to solve this problem.</p> <p style="text-align: justify;">Energy shortage is the result of the power demand and supply gap. So what causes this gap to exist is the main question. There are various reasons because of which Pakistan could not create more electricity which include the rising fuel prices, rising burden of circular debts, lack of availability of inexpensive fuel, no new power projects being started, poor electricity production and distribution methods, power theft and nonpayment of electricity bills.</p> <p style="text-align: justify;">The issue of circular debts is not something new when it comes to energy crisis. When the circular debts reach their peak the government intercepts by increasing the subsidy given to the power companies. However this does not provide a permanent solution to the problem because the subsidies given are not sufficient to pull the power supply companies out of difficulty. At present only Rs3/kilowatt subsidy is given where as 20-30% of electricity is being stolen and the electricity bills of government offices remain due for months. This burden is then passed on to the end consumers in terms of higher prices or excessive amounts of load shedding.</p> <p style="text-align: justify;">The problem of energy theft is something which needs to be addressed at the governmental level. It signifies the inefficient law and order situation of the country as the government knowing who the thieves are still does nothing to catch them. If the government takes strict action against those who steal electricity then half the problem of power shortages would be solved. There are various suggestions from across the broad to make power theft a non bailable offence; however nothing has been done in regard to such suggestions.</p> <p style="text-align: justify;">Rising fuel costs in the production of electricity are also a major source of concern. Natural gas and imported oil are the two major components of power production. While imported oil was always expensive for power producers, the shortage of natural gas has added further to their miseries. Natural gas always seemed to be in abundance in the country however in recent times the country has surprisingly faced natural gas shortages too. So the only way out for Pakistan is to find other sources of energy generation. Coal in the country is in abundance but the lack of expertise in the country does not allow it to be used in the right direction.</p> <p style="text-align: justify;">As Pakistan faces several problems, the problem of load shedding too should be given top priority by the government officials. It’s time the politicians start acting in order to solve the general problems of the people of Pakistan rather than fighting for getting into power and doing nothing.</p>