NEPRA grants 90MW power generation licences

KARACHI: The National Electric Power Regulatory Authority (NEPRA) has granted generation licences to three sugar mills to set up bagasse-run plants with a cumulative capacity of 90 megawatts, revealed an official document.
Bandhi Powergen Company (Pvt) Ltd, a subsidiary of Bandhi Sugar Mills Limited, Ansari Powergen Company (Pvt) Ltd, a subsidiary of Ansari Sugar Mills Limited and TAY Powergen Company Limited, a subsidiary of Tando Allah Yar Sugar Mills Limited have planned to set up 30MW bagasse-based thermal power generation plant each.
A number of sugar mills have proposed to implement co-generation power projects in order to take advantage of the incentives offered by the government and to integrate the expansion project for future mill operations.
At present, bagasse-based power costs Rs10/unit, hydroelectricity Rs2.50/unit, natural gas power around Rs5/unit and electricity produced through diesel costs Rs23 to Rs28/unit.
Officials said the Economic Coordination Committee (ECC) of the Cabinet, in its meeting held on March 6, approved the framework for power cogeneration 2013 bagasse and biomass as an addendum to the Renewable Energy Policy 2006. This framework is effective for all high pressure cogeneration projects, utilising sugarcane raw and biomass.
NEPRA had already approved Rs10.50/unit as the upfront tariff for power generation through bagasse by sugar mills.
NEPRA spokesman said this upfront tariff is to encourage sugar mills to produce around 1,500 megawatts on fast-track basis.
“The approval of upfront tariff for sugar mills will encourage them to plan their investment in this new sector for steering the country out of the power crisis,” the official said. “The government plans to generate around 3,000MW of cheaper electricity through sugarcane bagasse on fast-track basis and investors will be facilitated and encouraged.”
Necessary amendments will also be made in the existing co-generation and renewable energy policies to make it simplified and investor-friendly.
Pakistan is the world’s fifth largest sugarcane producer, annually producing 50 million tons of sugarcane, which yields more than 10 million tons of bagasse.
The officials said power generation from bagasse will not only reduce the furnace oil import, but also save Rs33 billion to Rs49 billion worth of foreign exchange per annum.
The country has 87 sugar mills with the capacity to generate 3,000MW from bagasse in winter season.
Currently, seven sugar mills sell their surplus power to government, including Layyah Sugar Mills with an installed capacity of 9.2MW and export of 4MW; Hamza Sugar Mills 23.6MW and Shakarganj Sugar Mills operating a 20MW co-generation power plant.
Al-Noor Sugar Mills generates 21.8MW and now plans to increase its capacity to 36.8MW. Rahim Yar Khan Sugar Mills produces 18MW and sells 10MW. Likewise, Al-Moiz Sugar Mills generates 27MW and exports 15MW, while JDW Sugar Mills generates 22MW with a surplus of 10MW.
In Pakistan, sugar mills generally operate during winter from November through April.
The country’s power generation capacity is at the lowest level during these six months due to water and gas shortages.
Additional power generation through a local renewable biomass fuel will not only help the country overcome its chronic power shortages but also save precious foreign exchange spent on furnace oil import. Furthermore, efficient use of a biomass fuel like bagasse is environment- friendly with low greenhouse gas emission.