Flagship CPEC power transmission line shelved till Sept

LAHORE: The launching of flagship China Pakistan Economic Corridor (CPEC) 4,000mw South-North transmission line project has been delayed to September 2021, making grid stability and power affordability another pipe dream for now, The News has learnt.

The delay has been attributed to outstanding work, pending on the part of both state-owned transmission company and the contractor.

According to the Memorandum of Understanding signed between National Transmission and Despatch Company (NTDC) and the Chinese company, Pak Matiari-Lahore Transmission Company Pvt Ltd (PMLTC), it is clearly mentioned in the clause 6 that: "Both Parties shall complete their outstanding works at the earliest to guarantee that the extended COD (commercial operation date) will be realised not later than 01.09.2021".

This major setback to this high priority CPEC project will lead to inordinate delay in connecting power plants having least cost generation before peak summer months, which may result in high tariff for consumers.

The failure in completing +/-660kv HVDC Matiari-Lahore Transmission line by its scheduled COD in March 2021 may make people vulnerable to summer load shedding too as delay in execution of the transmission line would erode grid flexibility in terms of a balancing act between thermal power plants in South and hydropower projects and load centers in North.

The spokesperson of Ministry of Energy (Power Division) has admitted the delay in launching of project till September 2021. However, he insisted the delay was not on part of Power Division or NTDC, but due to technical testing reasons on part of the EPC (engineering, procurement, and construction) contractor since it was Pakistan's first-ever high voltage direct current (HVDC) transmission line.

Therefore, he added, all international standards were being fulfilled to ensure its endurance and complete synchronisation with existing system.

It clearly means such assurance will result in major saving from any future failures.

The spokesman did not comment on financial impact due to failure of connecting least cost thermal generation in South including indigenous Thar Coal projects. He was specifically asked to comment on this aspect -impact of not linking power plants having cheap generation cost with load centers in terms of high tariff for the consumers.

Nevertheless, spokesperson held the view that there were no capacity charges due to the delay which the Power Division had to pay to EPC contractor. There is cost saving in take-and-pay energy transmission after 31st March 2021 i.e., pre-COD till 1 September, 2021.

About frequency of load-shedding during upcoming summer, the spokesperson claimed there was no impact on load management due to any delay in full capacity delivery of HVDC line as adequate transmission capacity existed in the system to cater for the summer requirements as per estimates.

Denying any adverse impact of extended COD, he maintained the delay due to international standards tests on part of EPC contractor and existence of enough electricity for summer, the project was still going in the right direction.

It may be noted that PMLTC served a notice of dispute on December 11, 2020 regarding issues leading to the delay in launching of +/-660kV HVDC Matiari-Lahore Transmission Project. Later, both parties agreed on February 18, 2021 over a revised schedule of launching the project. There are many firsts attached to this novel transmission line project. The transmission line was included in the framework of the Early Harvest CPEC projects. It has been termed a crucial step for the evacuation of bulk electricity, leading to the general improvement of Pakistan’s grid structure. It will be the first HVDC transmission line in the country. Furthermore, the project will also be the first power transmission line in Pakistan financed through the foreign investment as well as private sector.

The scope of this highly important project includes evacuation of power from coal-based plants located in Thar, Port Qasim, and Hub through 878 km long 4000 MW ±660 kV HVDC Line Matiari-Lahore, 878km with estimated cost of about 1.7 billion dollars. The Financial Closed of the project was achieved on February 27, 2019 while its original scheduled COD was due in March 2021.