According to an estimate, 33 million people were affected by heavy rains in Pakistan during July-August this year. Climate scientists have enough data to claim that the unusual rains in Pakistan were caused by the warming of the Indian Ocean by 1.2 degrees Celsius.
Fortunately, major cities and most urban centers of Pakistan were spared from the floods. However, many of their residents are also facing a tsunami – not a flood, but a tsunami of inflation. Although the government has cut petrol and diesel prices, much to the dismay of the IMF, electricity and gas prices are still painfully high. The coming winter in Pakistan is understandably dire for the millions displaced by floods. However, the winter will be harsh even for those who survive the floods as gas (the primary source of cooking/cooking in urban areas of Pakistan) will either be in short supply or very expensive.
In New York, sensing the continued impact of rains and floods in Pakistan, the UN Secretary-General increased the UN Flash Appeal from $160 million to $860 million. The response of the international community to these appeals has been warm for a number of reasons.
In Washington, during the recent fall meetings of the World Bank and the IMF, the multilateral lenders reminded the government of Pakistan to share their condolences with the people of Pakistan for the devastating flood damage in Pakistan. ) moving from subsidies that target specific commodities (such as blanket subsidies on energy) to those that target needy groups within a country. In other words, while the IMF may consider giving Pakistan some policy relaxation for flood recovery, blanket subsidies on energy in the name of flood victims will not be acceptable.
Finance Ministers around the world are losing sleep and Minister Ishaq Dar is no exception. In Britain, Liz Truss resigned because her promises to tackle energy inflation were unworkable. In other European capitals as well, governments are struggling to maintain cheap energy supplies in the winter while reducing dependence on Russian energy supplies. They are locking in their gas contracts in the Gulf region – for future delivery – at much higher prices than developing countries like Pakistan.
World governments, businesses and civil society are gathering in the Egyptian resort of Sharm el-Sheikh to discuss how to tackle global warming through low carbon emissions (COP27).
Wondering what the standalone pieces of information provided above have in common? Look at the above section again with a “fossil fuel” lens, and you’ll realize that the availability and affordability of fossil fuels and their effects on global warming are affecting people and governments alike around the world. From a flooded village in Pakistan to a European capital. Spread the wings of your imagination, and you’ll find both a direction for the future of energy and the policy trade-offs for that future. These trade relationships will likely shape the future of many governments and the planet itself.
Take the case of floods in Pakistan. This year’s unprecedented rainfall in Pakistan was caused by warm air in the Indian Ocean, which carried more moisture and brought more rain. Rising sea surface temperatures due to indiscriminate use of fossil fuels is a manifestation of global warming.
Russia is one of the largest producers and exporters of gas. The war in Ukraine and the resulting sanctions on Russia have negatively affected global energy supplies and made energy more expensive. To meet this energy shortage, in the short term, many Western countries have postponed their plans to phase out coal (a dirtier fuel but more efficient than gas) for electricity generation, i.e. More carbon emissions and more global warming.
Even before the devastating floods, Pakistan was going through an economic crisis — expensive energy imports contributing to its dollar deficit (current account deficit); Generating expensive electricity and selling it cheaply at subsidized rates contributes to its rupee deficit – energy circular debt (fiscal deficit). The government of Pakistan has to reduce its import bill and energy circular debt for bailout from IMF and macroeconomic stabilization.
The challenge for Pakistan this winter is not only to reduce (energy) imports. His main concern is to ensure a steady supply of whatever he can import. Pakistan will have to compete with deep-pocketed European energy importers in global energy markets to ensure that it can find LNG in the spot market and that its LNG suppliers can meet their long-term needs. Supply commitments do not lead to defaults.
Even if it were to arrange the money, secure the gas supply, and generate electricity—albeit at higher prices—the government would find it difficult to recover the total cost of electricity generation without losing its political capital, and it Even in the current highly polarized political climate. Environment for the next elections Assuming that the government dares to stake its politics and decide not to subsidize electricity to save the IMF deal, the next question is whether consumers will Able to pay the price?
The picture is bleak but hints at a solution. To control global warming, to appease voters by providing uninterrupted cheap energy, to prevent oil/gas producing countries from using their energy resources as a strategic weapon, and all To ensure energy for (Sustainable Development Goal 7), the world will have to phase out fossil fuels and transition to renewable energy (RE).
Let’s talk about Pakistan first. The potential of RE in Pakistan is yet to be fully explored. According to the Sustainable Development Policy Institute’s recently released State of Renewable Energy report, “Pakistan’s transition to a 100% renewable energy system is not only entirely feasible but also a low-cost option for the country.” This will help reduce energy system costs while reducing dependence on imported fossil fuels, increasing energy security.
Pakistan’s energy experts and its policy makers are aware of the potential of solar, wind and small hydel plants for power generation. They also know what needs to be done to promote RE. Its political leadership has repeatedly pledged in international forums to increase the share of renewables in its energy mix. However, there are trade-offs in policies.
The biggest challenge is the cost of energy transition – not just the cost of upgrading technology and infrastructure, but the cost of capacity payment charges. The more existing customers reduce their reliance on ‘on-grid’ electricity and look for ‘off-grid’ solutions, the less power generation companies will be able to sell. This would increase capacity payment charges (payments to generators for not buying power from them) and would be problematic, at least in the short term.
On the international front, high emitters of greenhouse gases (mainly the developed world, China, India, and Brazil), can meet their emission reduction commitments by switching to RE. The United Nations Environment Program (UNEP) found in its latest ‘Emissions Gap Report’ that the gap in carbon dioxide emissions in 2030 has been shaved by just 0.5 billion tonnes from last year’s 17 billion to 20 billion tonnes. An annual rate will be required. Offering a reasonable chance of limiting warming to 1.5C above pre-industrial temperatures.
UNEP says: “The world’s current climate policies – real action on the ground, not just promises – equate to a warming of 2.8C by 2100”. Unusual rains in Pakistan are being attributed to 1.2 degrees Celsius temperature. The world should understand that what started in Pakistan will not stay here. If the pattern of energy production and consumption is not changed, the entire world will face the adverse consequences of climate change and that too in the near future.
