Pakistan Energy Outlook for Next 25 Years
DOI:
https://doi.org/10.61506/01.00364Keywords:
Pakistan Energy , Deman-supply Gap, Box Jenkins Methodology, Energy Demand-Supply Gap, Energy ForecastingAbstract
This research aims to estimate the sectoral demand and supply of energy in Pakistan. It incorporates macro and microeconomic data to make reliable forecasting for each sector and sources of energy that is aligned with demographic, economic and industrial development of Pakistan. Box Jenkins methodology in which the ARMAX model is applied to use historical data for forecasting. This research used the time series data from 1990 to 2021. From the analysis, it has been found that estimated energy indicates that energy demand and supply will be continuously increasing, and the demand and supply gap will be minimized in the next 25 years. The overall estimates of the energy supply mix indicate that over-dependence on oil for energy production will be reduced from 23.3% in 2021 to 15.2% in 2046. Similarly, demand for oil will decline from 21.2% in 2021 to 10.7% in 2046. However, supply mix reflects an inclination towards the usage of coal and renewable energy sources for the production of energy. In addition, renewable energy sources demand increases from 1.0% in 2021 to 7.3% in 2046. The core finding of the research suggests that energy deficit will decline with the effective implement a government energy supply plan that result in the elimination of energy deficit in next seven years. There is a supply and demand gap even though both energy demand and supply will increase. Higher dependence on imported energy import bills is on continuous rise which burdened the economy with higher debt. However, by shifting it to renewable energy sources, this can be minimized and made the energy affordable and accessible. The energy estimates for the supply suggest that dependence on oil will decline due to higher environmental concerns. However, there will be more inclination toward sustainable sources of energy production.
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