Sugar mills get licence to set up 60MW projects

KARACHI: The government has allowed two sugar mills to set up more than 60 megawatts of bagasse-based cogeneration plants in Punjab, an official said on Friday.

The official said each project is estimated to cost around $35 million.  The National Electric Power Regulatory Authority (Nepra) granted power generation licences to Bahawalpur Energy Limited, a project of Ashraf Sugar mills Limited, and Ittefaq Power Limited, a project of Ittefaq Sugar Mills, for their proposed generation facilities of 31.20-megawatt each. 

When the Alternative Energy Development Board (AEDB) formulated the policy for development of renewable energy sector in 2006, the aim was to explore hydro, wind and solar power technologies. Later on, the policy’s scope was enhanced to include power projects based on bagasse, biomass, waste-to-energy and bio-energy.

AEDB had issued letter of intent to different entrepreneurs and power developers, including Bahawalpur Energy Limited and Ittefaq Power Limited for setting up a 31.2 MW bagasse-based power project.

A Nepra official said the proposed projects would result in optimum utilisation of renewable energy resources, which were earlier untapped, resulting in pollution free electricity generation.

In 2013, the authority announced an upfront levelised tariff of Rs10.4078/kilowatt hour for bagasse project, which is very competitive considering the fact that electricity generated from bagasse is cheap. 

Share of bagasse-based power in total production stood at merely 0.61 percent in May 2016. The country’s power production stands at around 18,000 megawatts. Various estimates put crushing capacity of around 80 sugar mills at 600,000 tonnes per day. Total 50 million tonnes of sugarcane yield 15 million tonnes of bagasse assuming 32 percent fibre on cane.