Using Water as Fuel: Pakistan’s Ranolia Hydropower Project

Project Result / Case Study | 26 January 2016

A 17 megawatt run-of-river plant harnesses Pakistan’s rich clean energy potential, generating enough power to service about 600,000 new connections or 4.8 million people. 

Ranolia, Pakistan - For years, this country has struggled with the fluctuating global prices of oil needed to feed the power plants that drive the economy.

“Imported oil is the main source of Pakistan’s power supplies, and this has put a severe strain on the country’s finances,” said Ehtesham Zafar Khattak, a senior project officer at the Asian Development Bank (ADB) office in Pakistan. “Power shortages, estimated at over 5,000 megawatts during peak demand, have led to blackouts and load shedding which in turn have caused economic and social turmoil.”

Harnessing the power of water

Part of the solution to this problem is the Indus River, which roars down from some of the world’s highest mountains and glaciers and feeds into a vast network of smaller rivers and streams. The mighty river flows from the mountains of northern Pakistan’s high passes, deep gorges, and rolling hills to sweep across the vast irrigated plains of Khyber Pakhtunkhwa, Punjab, and Sindh provinces before reaching the Arabian Sea on the southern tip of the country.

The Indus River network is estimated to hold electricity generation capacity of 60 to 70 thousand megawatts, triple the total current national electricity demand. The power of the river could change the way Pakistan generates electricity.

Hydropower was once a major source of energy in Pakistan, accounting for nearly 45% of all electricity generation in 1991. However, this share has dropped to about 28% due to a decline in the construction of hydropower plants and rising demand. The share of thermal generation has risen to about 70%, with most plants using unaffordable oil or gas.

A reliable supply of power is critical to achieving Pakistan’s economic growth targets. ADB is the country’s largest development partner in the energy sector. Under the government’s leadership, it is working with other development partners and the private sector to expand the use of renewable energy and broaden and strengthen the country’s energy mix. This includes financing hydro and gas-fired power plants, supporting energy efficiency programs, and investing in innovative wind and run-of-river hydropower projects.

“A reliable supply of power is critical to achieving Pakistan’s economic growth targets.”

The Ranolia run-of-river hydropower project is part of this effort to harness Pakistan’s rich clean energy potential. Ranolia is one of two hydropower projects being built by the Khyber Pakhtunkhwa provincial government under the ADB-supported Renewable Energy Development Sector Investment Program. The $510 million program—which is also financing four hydropower plants on irrigation canals in Punjab province—is part of a broader national plan aimed at generating a total of 1,700 gigawatt-hours of power annually, enough to service about 600,000 new connections or 4.8 million people.

“It was a challenging project in terms of attending to detailed engineering aspects in view of the terrain, and also for catering to the environmental and social safeguard standards,” said Khuda Baksh, the project manager for the contractor, Descon.

“This was the first big project in this remote village so expectations were high,” said Baksh. “The electricity produced by the project will go into the national grid and most villages have their own micro-hydro power for local electricity needs, so initially we had a hard time convincing them of the value of this development initiative.”

Power for all and jobs for the locals

But the project brought significant local benefits as well. A key opportunity was employment, with just over 2,000 local jobs created during construction. Of those, about 150 were skilled workers, many of whom will continue to work at the facility. In addition to employment and other benefits, the project upgraded a key road improving access to schools, hospital, and markets in the nearby town of Besham.

Project Director Nasir Khan Gandapur says the people of Ranolia are also proud that the 17 megawatts of electricity produced by the plant, enough to light up a small city, will be put into the national grid to help the country as a whole.

“This run-of-river hydropower project is expected to recover the investment in three years, and then it will start earning profit using water as the fuel!” he says.

Mohammad Ismail Khan, Senior External Relations Officer at ADB’s Pakistan Resident Mission. Follow the Resident Mission on Facebook.