4.1. Conclusion
This study has highlighted that the high cost of energy generation, circular debt and burden of subsidy are the root causes of energy crises in Pakistan. In addition, the study has indicated that there is direct relationship among cost of energy production and circular debt, whereas, the burden of subsidy is the main cause behind creation of circular debt. Therefore, to address the root causes of energy crises, the optimization of the energy production system has been performed using LP (linear programing) model. As the high cost of electricity generation has been found as the root cause of energy crises, the objective function of the proposed model is cost minimization. Two different scenarios have been developed and examined. The first scenario considers that the existing system should be used at its maximum capacity; in the second scenario, seventy percent utilization of power plants has been examined. The second scenario summarizes the optimum mix of energy production. The optimal mix of energy production minimizes the cost of electricity production to PKR 10.75 per unit (kWh). The differential cost PKR 3 per unit (kWh), that is payable by the government as a subsidy is also compensated. Similarly, it reduces circular debt that is a bottleneck between power generation companies and oil supply companies. Once the bottleneck has been bridged, the timely payments to energy generation units would be possible. So, oil based power plants can timely pay their bills and other power plants can improve their productivity with timely available funds. Finally, the availability of funds will improve efficiency of power plants that will raise the production level to minimize the load-shedding in the country.