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IPP seeks licence extension

Business

May 29, 2020

KARACHI: Gulf Powergen (Pvt) Ltd, operator of 83.835MW power plant in Punjab, has sought three-year extension in its generation license until the independent power producer (IPP) finds a purchaser for its output.

Gulf Powergen’s generation license as well as its Power Purchase Agreement (PPA) with Central Power Purchase Agency (CPPA) expired on May 24, 2020.

“After expiry of the existing PPA with CPPA, Gulf Powergen intends to operate the plant and is in the process of finding out the power purchaser(s) to sell its output,” the IPP wrote to the National Electric Power Regulatory Authority (NEPRA).

In September 2008, the government decided to allow projects to be set up on rental basis for a period of up to five years to meet the power requirements on short-term basis. In response, the consortium comprising Al Jomaih Holding Company and Haseeb Khan submitted a proposal for an RFO-fired power plant in the name of Gulf Rental Power Plant, which became Gulf Powergen Pvt Ltd in 2014, and obtained a generation license as an IPP.

Gulf Powergen is considering sale of the output of the plant to CPPA as short-term IPP for another three years or longer in accordance with the Economic Coordination Committee (ECC) decision for utilisation of existing available capacity. In this regard, Gulf Powergen has already requested and given its consent to CPPA for extension of existing PPA for another term.

The IPP is also weighing sale of the entire or part production capacity of the plant to any interested bulk power customers like housing societies, industrial parks, etc.

“We understand that NEPRA envisages arranging development and operation of a competitive trading market for the power sector in the near future for procurement of electric power through competitive bidding. Gulf Powergen intends to participate in the competitive trading market, as and when established,” the company said.