Pak requires political will to make 'hard decisions' on energy crisis

Afghanistan Sun

Political will is required from the government of Pakistan and opposition parties to make hard decisions on the country's energy crisis, according to Alex Thier, who is USAID's Assistant to the Administrator for the Office of Pakistan and Afghanistan Affairs. Thier, who returned from a trip to Pakistan last week, said that USAID programmes would have added 900 megawatts to the grid by early next year, reports The Express Tribune. "Pakistan is only going to solve its energy crisis if it better governs the energy system," said Thier, adding that this requires work on the transmission system's losses, cracking down on theft, ensuring payment of electricity bills and an efficient load shedding management system. "What really needs to happen is at the political level, that some of these changes, like making sure the electricity tariffs are equivalent to the costs because otherwise the circular debt problem is never going to go away. If Pakistan can't generate electricity and basically can't charge consumers for the electricity that it generates then the system is never going to reach a balance. But you can't charge people more for energy if you don't provide it consistently, so you need to improve the management and delivery of the system," he added. Thier said the Pakistan government has made clear to the US that their number one development priority for Pakistan is Diamer-Bhasha Dam. Thier said the US has committed to working with the Asian Development Bank and the government to carry out the necessary studies - feasibility, environmental, social safeguards, engineering and financing. "The financing plan is deeply tied to these questions of energy reform. The financing plan basically has to say that is there a business model by which this investment will be productive and will yield sufficient returns over time to pay back loans, to pay the private sector and so on. So all five of those feasibility studies need to be conducted in order to get the international financing to actually build the dam," said Thier. In new programmes, USAID is spending 44 million dollars on the Pakistan Private Investment Initiative, which aims to match private sector funds in investment in small to medium enterprises in Pakistan, he added.