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April 13, 2018

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Nepra to announce tariffs for Gwadar’s coal-fired power project

Karachi: National Electric Power Regulatory Authority (Nepra) is expected to announce tariffs for Gwadar’s first coal-fired power project of 300 megawatts by the end of this month, it was learnt on Thursday.

CIHC Pak Power Company is developing the power project based on imported coal under the China-Pakistan Economic Corridor (CPEC).

Nepra convened a meeting on April 24 to consider the tariff petition of CIHC Pak Power Company for the proposed 300MW coal-fired power plant.

CIHC demanded Rs8.9 tariff for 30 years since the start of the project. Nepra would consider whether or not the engineering, procurement and construction cost of $369.89 million has been achieved through transparent and competitive bidding process, and is justified.

The authority will also discuss capital expenditure of $117.25 million, requested return on equity of 17 percent and requested premium on Karachi interbank offered rate.

The hearing will also take up whether or not the proposed fuel cost component and delivered coal price of $101.8/ton is justified. An official said Gwadar’s deepwater port and its

surrounding areas have become a major part of CPEC.

Gwadar’s strategic position will attract several industrial projects, which in turn will have significant power requirements.

Currently, Gwadar depends on approximately 70MW of imported power from Iran. Of that, approximately 14MW is allocated to Gwadar, while Makran coastal region utilises the remaining 56MW.

Moreover, there is no interconnection point in or close to Gwadar for the national grid. Instead there is a relatively independent grid that connects Gwadar, Turbat, Panjgur and Pasni.

The joint cooperation committee (JCC) for CPEC decided a 300 MW imported coal-fired power project must be developed on fast track basis at the port city keeping in view the strategic importance of the port city to the corridor.

The JCC nominated China Communications and Construction Company or its nominated subsidiary to immediately undertake the development.

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