ISLAMABAD: The power regulator has approved a seven-year plan for K-Electric, under which the company will increase its generation capacity by about 3,200MW, mostly through renewable energy.

Under the seven-year Power Acquisition Plan (PAP 2024-30) approved by the National Electric Power Regulatory Authority (Nepra), K-Electric will get more electricity from the national grid, envisaging an estimated 9pc tariff reduction to 7.9 cents from the current rate of 8.7 cents.

The plan has been modelled on the assumption that power availability from the national grid will reach 2,050MW, up from about 1,100MW at present.

The increase in power generation is expected to be achieved through the commissioning of Karachi Nuclear to KE interconnection (KKI) along with 1,200MW from renewables, 82MW from hydro, and 990MW from thermal. “Based on these data and assumptions,” Nepra said the KE’s will come down from 8.7 cents/kWh in 2024 to 7.9 cents/kWh in 2030.

Seven-year PAP expects electricity from national grid to almost double

The Nepra made it clear that proposed tariff numbers in the PAP by KE were subject to regulatory proceedings and approvals, and tariffs shall be determined either through competitive auctions, negotiated or cost-plus mode, followed by the submission of bidding documents or tariff petitions.

“Therefore, the proposed PAP is approved to the extent of quantity of acquisition (MW) and procurement mode for firmed up projects”.

The regulator has extended the power purchase agreements of Tapal and Gul Ahmed with a condition that the tariff determined and approved by Nepra shall be applicable for these projects.

It did not extend the retirement dates of Bin Qasim Power Station’s Unit I and 2, saying taht any extension of BQPS- 1, if required, shall be justified in the upcoming PAP or through a separate request by K-Electric.

Moonis Alvi, the K-Electric CEO, welcomed the regulatory approval for PAP, saying the plan focused on the integration of renewable energy.

“KE aims to add 1,282MW of renewable energy, including solar and wind projects, by 2030. This includes a notable 270MW solar PV project in Karachi and a 200MW hybrid plant near the Dhabeji Grid Station.”

“These projects are expected to significantly contribute to the city’s energy mix, promoting sustainability and reducing the carbon footprint,” he said.

According to Nepra’s determination, KE would be wheeling electricity from the 82MW Turtonas-Uzghor Hydropower Project (TUHPP) near Chitral in Khyber Pakhtunkhwa for which the regulator has already approved the feasibility stage tariff of 7.9 cents per unit for 30 years at exchange rate of Rs123 per dollar.

Mr Alvi said the PAP provided a clear roadmap for the next five years and integrating clean energy “was vital to driving a sustainable energy ecosystem, balancing affordability with reliability as the company was receiving global interest in its 640MW renewable energy projects”.

The Nepra noted that KE’s 2024-30 PAP identified the power utility’s long-term electricity needs through the addition of new power generation and supply sources with a focus on reduction of its tariff price.

Published in Dawn, May 21st, 2024