Sale to be concluded on April 19: Govt gets nine bids in 100MW solar power plant privatisation

LAHORE: The privatisation of the 100 megawatts Quaid-e-Azam Solar Power Plant (QASP), for which nine firms have been invited to submit bids, is likely to be completed on April 19, 2018, officials said on Thursday, adding the sale is not at risk owing to a probe initiated by the National Accountability Bureau (NAB).

“The NAB has sought certain information about solar power which is being provided, however, the process of privatisation is continuing and it will be completed as per plan,” a senior official at the provincial Punjab government said.

“It was the advice of the provincial law department to go ahead with the privatization process.”

The government of Punjab, which currently owns 100 percent of Quaid-e-Azam Solar Power Plant , seeks to divest its entire stake along with management control. The Punjab Privatization Board on behalf of the federal government has invited expression of interest from investors interested in acquiring 100 percent of QASP’s share capital.

Officials said technically responsive bidders will submit financial quotation that will be opened on the occasion and announcement about successful bidder will be made on April 19. However, formal approval of the deal will be accorded by Punjab cabinet later.

As a result of technical bidding, nine companies, including Artistic Milliners Pvt. Ltd., Atlas Power (Pvt.) Ltd., China Haudian Company Ltd, Jahangir Siddiqui & Co., Master Textile Mills Ltd., Orient Electronics (Pvt.) Ltd., Vitol Dubai Ltd, Saba Power (Pvt.) Ltd. and TBEA Xinjiang SunOasis Co. Ltd have been pre-qualified for taking part in bidding process of the solar power plant.

The QASPL has been the country’s first utility-scale, grid-connected 100 megawatts Solar Photovoltaic (PV) plant that has been contributing electricity to the national grid since March 2015.

The plant is located in Bahawalpur, while its registered office is in Lahore. With 18.27 percent capacity factor, the plant’s tariff has been set at 14.97 cents/unit.

The financial year 2016 revenue of the plant stood at Rs 2.95 billion.

The tariff is particularly attractive in view of the recent moves by NEPRA to rationalize returns for renewable generation.

The incoming investor will have an excess land of 150 acres available which could be utilized for expansion. A guaranteed of 17 percent/annual return as part of the approved upfront tariff with guaranteed off-take for 25 years.

Since the completion of the project, the solar sector has achieved robust attraction from investors and a number of projects are currently in the pipeline.

As the company has achieved its objective and currently producing up to 12 percent more power than the energy production requirements set by the Nepra, the provincial government has decided to divest QASPL shares through an investor.

During its first 18 months of operation, QASP generated approved energy of 232,660 MWh, while operating at a capacity factor of 18.27 percent against NEPRA’s benchmarks of 223,094 MWh and 17.5 percent respectively.