Nepra awards upfront tariffs

KARACHI: National Electric Power Regulatory Authority (Nepra) awarded upfront tariffs to bagasse-based power projects with more than 100 megawatts of generation capacity.

Four leading sugar mills, in separate notices to Pakistan Stock Exchange on Tuesday, said their power subsidiaries were awarded upfront tariffs.  HSM Energy, a wholly-owned subsidiary of Habib Sugar Mills, Mehran Energy, a subsidiary of Mehran Sugar Mills, Faran Power of Faran Sugar Mills and Mirpurkhas Energy, a wholly-owned subsidiary of Mirpurkhas Sugar Mills were awarded upfront tariffs for their planned bagasse-based co-generation power projects of 26.5MW each. Almost all the sugar companies surged on PSX with Mehran Sugar and Faran Sugar hitting the upper circuit breakers. A stock analyst said the past few years brought radical reforms to the industry, resulting in an enhanced production, better sucrose recovery, bagasse power generation and development of in-house distillery to convert molasses into bio ethanol. Government’s target for sugarcane bagasse-based power production is 800MW by the end of 2018 from the existing 160MW. In the recent years, therefore, there has been an exponential growth of bagasse/biomass-based power projects. Government estimated that at least five percent of total national power generation capacity (9,700MW) would be met through renewable energy resources by 2030. Nepra said the existing energy mix of the country is heavily skewed towards the thermal power plants, mainly operating on imported fossil fuel. So, it is imperative that indigenous renewable resources are given priority for power generation and their development is encouraged in order to achieve sustainable development, it added. The Energy Security Action Plan 2005 recognises the very aspect of power generation. Alternative Energy Development Board said currently the installed capacity of renewable energy is 1,350MW. 

Many sugar mills are already engaged in electricity production for their own usage and supplying surplus power to the electricity distribution companies.