The good and bad of changing power mix
The winds of change have begun to blow. Not only has the power generation picked up recently, its composition has altered as well. For over 20 years, the country’s energy mix has been stubborn, dictated by thermal power where depleting natural gas reserves had given most space to the expensive fuel like furnace oil. But the situation took a turn when the power mix started changing as the country started increasing the share of other fuels like coal, imported RLNG and renewables.
This improvement in the energy mix however, has to be taken with a pinch of salt. Unfortunately, these changes have left the local refineries and the oil marketing companies in a pickle. Where the OMCs are seeing a furnace oil supply glut due to the cut in furnace oil consumption by the power sector, the refineries are in no better shape. Their operational difficulties had heightened to a point where most of them had declared a complete closure if the matter of furnace oil upliftment was not taken seriously by the authorities.
Published in Business Recorder, 22nd December, 2017