{"id":10607,"date":"2025-07-29T11:32:27","date_gmt":"2025-07-29T06:32:27","guid":{"rendered":"https:\/\/ksestocks.com\/blog\/?p=10607"},"modified":"2025-07-29T11:32:27","modified_gmt":"2025-07-29T06:32:27","slug":"why-pakistan-is-phasing-out-furnace-oil-in-power-generation-and-whats-replacing-it","status":"publish","type":"post","link":"https:\/\/ksestocks.com\/blog\/why-pakistan-is-phasing-out-furnace-oil-in-power-generation-and-whats-replacing-it\/","title":{"rendered":"Why Pakistan is phasing out furnace oil in power generation, and what\u2019s replacing it?"},"content":{"rendered":"\n<p>Pakistan is slowly shifting away from using expensive and polluting fuels to generate electricity. One big change? The reduced use of <strong>furnace oil (FO)<\/strong>, a thick, dirty fuel that was once a major source of power in the country.<\/p>\n\n\n\n<p>Let\u2019s break down what\u2019s happening in simple terms.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What&#8217;s changing in Pakistan\u2019s power generation?<\/h2>\n\n\n\n<p>Until a few years ago, many of Pakistan\u2019s power plants ran on furnace oil. But now, that\u2019s no longer the case.<\/p>\n\n\n\n<p>Since <strong>FY2017-18<\/strong>, Pakistan has <strong>slashed the use of furnace oil<\/strong> for electricity. Why?<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>It\u2019s <strong>too expensive<\/strong><\/li>\n\n\n\n<li>It <strong>pollutes the environment<\/strong><\/li>\n\n\n\n<li>There are <strong>cheaper alternatives now<\/strong>, like coal, gas, and nuclear energy<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">What\u2019s replacing furnace oil?<\/h2>\n\n\n\n<p>Pakistan has built <strong>imported coal power plants<\/strong> under the <strong>CPEC<\/strong> program. At the same time, <strong>new RLNG (gas) plants<\/strong> and <strong>nuclear power stations<\/strong> have come online.<\/p>\n\n\n\n<p>These newer options are:<\/p>\n\n\n\n<p>\u2705 Cheaper<br>\u2705 More efficient<br>\u2705 Cleaner (in the case of nuclear and gas)<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What is the merit order?<\/h2>\n\n\n\n<p>To decide <strong>which power plants should run first<\/strong>, Pakistan uses a <strong>\u201cmerit order\u201d system<\/strong>. This list ranks power plants based on how cheap they are to run.<\/p>\n\n\n\n<p>Here\u2019s a snapshot of recent numbers:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Gas plants<\/strong> like UCH are the cheapest: ~PKR 3.07 per unit<\/li>\n\n\n\n<li><strong>Coal plants<\/strong> (like Thar Block-I) come next: ~PKR 5.62\u20136.55 per unit<\/li>\n\n\n\n<li><strong>Furnace oil (HSD) plants<\/strong> are at the bottom: ~PKR 59+ per unit!<\/li>\n<\/ul>\n\n\n\n<p>\ud83d\udca1 So, the cheapest plants get used first. FO plants are only turned on <strong>during high demand months (like summer)<\/strong> or to <strong>use up leftover fuel<\/strong> from local refineries.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Why do we still use furnace oil at all?<\/h2>\n\n\n\n<p>Even though FO use is falling, it\u2019s still <strong>part of the energy mix<\/strong> because:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Some <strong>older plants can only run on FO<\/strong><\/li>\n\n\n\n<li>Local <strong>refineries produce FO as a byproduct<\/strong><\/li>\n\n\n\n<li>The <strong>government hasn\u2019t signed key agreements<\/strong> to fully phase it out yet<\/li>\n<\/ul>\n\n\n\n<p>Refineries are worried: If FO demand disappears completely, it could hurt the production of <strong>other fuels like petrol and diesel<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">What\u2019s the government doing?<\/h2>\n\n\n\n<p>Pakistan&#8217;s <strong>refinery policy<\/strong> aims to:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Reduce FO production<\/li>\n\n\n\n<li>Encourage cleaner fuel standards<\/li>\n\n\n\n<li>Modernize refineries<\/li>\n<\/ul>\n\n\n\n<p>But delays in signing agreements have <strong>slowed progress<\/strong><\/p>\n\n\n\n<p>Furnace oil is on its way out, but not gone yet.<\/p>\n\n\n\n<p>Pakistan\u2019s power grid is moving toward <strong>cleaner, cheaper energy<\/strong>, like coal (from local mines), gas, and nuclear power. FO will continue to play a small role <strong>until new policies kick in<\/strong> and infrastructure fully shifts away from old tech.<\/p>\n\n\n\n<p>For now, the high-cost FO plants are kept <strong>as backup<\/strong>, like an old generator you only use when nothing else works.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Pakistan is slowly shifting away from using expensive and polluting fuels to generate electricity. One big change? The reduced use of furnace oil (FO), a thick, dirty fuel that was once a major source of power in the country.<\/p>\n","protected":false},"author":9252,"featured_media":9345,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[153],"tags":[277],"class_list":["post-10607","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","tag-power-sector"],"featured_image_src":{"landsacpe":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks11-1140x445.jpg",1140,445,true],"list":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks11-463x348.jpg",463,348,true],"medium":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks11-300x188.jpg",300,188,true],"full":["https:\/\/ksestocks.com\/blog\/wp-content\/uploads\/2025\/05\/Top-X-Stocks11.jpg",1920,1200,false]},"_links":{"self":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10607","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/users\/9252"}],"replies":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/comments?post=10607"}],"version-history":[{"count":1,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10607\/revisions"}],"predecessor-version":[{"id":10608,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/posts\/10607\/revisions\/10608"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media\/9345"}],"wp:attachment":[{"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/media?parent=10607"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/categories?post=10607"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ksestocks.com\/blog\/wp-json\/wp\/v2\/tags?post=10607"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}