Energy Demand Projection and Economy Nexus of Pakistan

Abstract

In the fundamental study to design sustainable electricity generation, long-term electricity demand forecasting has taken on a crucial role. The Low Emissions Analysis Platform (LEAP®) software is used in this study to estimate the demand for energy by various consumer groups including commercial, residential, agricultural, and industrial for the study period (2023-2050). The electricity demand is forecasted under different Gross Domestic Product (GDP) growth scenarios. The developed scenarios are reference, low economic growth, medium economic growth, and high economic growth scenarios. This study identifies the key relationship between energy demand and the economy of Pakistan. It is found that energy demand and the GDP of the country have a direct relationship as one quantity increases, the other one also increases, and vice versa. 3.56% growth rate of GDP under the low GDP growth scenario causes an increment in energy demand from 137.97 million MWh in 2023 to 374.79 million MWh. Medium and high GDP growth scenario pertains to GDP growth rates of 5.79% and 10.22% which causes an increment in energy demand to 652.17 million MWh and 1,244.75 million MWh by 2050. The results of this study are significant and provide insight into electricity demand growth under the economic scenarios that could be useful for sustainable electricity planning in Pakistan.