Pakistan and Iran signed an agreement, on Monday, fixing a tariff range of Rs8.4 to 12.4 per unit for the supply of 100 MW to Gwadar and Gwadar Port.
Initially, the two were negotiation a tariff between Cents 9.9 to 15.3 per unit, and making it applicable with immediate effect on both the new Polan-Gabd electricity transmission line and the existing Jakigur-Mand interconnection line (the agreement for which expires on December 31, 2024).
Both sides, however, agreed on a new pricing formula. The Iranian side agreed to keep the tariffs unchanged for the existing Jakigur-Mand interconnection line until December 2024 and also agreed to bring the new tariffs for the Polan-Gabd electricity transmission line down to the range of Cents 8.4 to 12.4 per unit, which is in Pakistan’s favour.
Analysts argue that the settlement of tariffs is a positive development that will make possible the operationalisation of the 220-kV Polan-Gabd transmission line.
The additional 100MW electricity will be supplied to the region via the line and will account for addressing the electricity issues of Gwadar for the next 5-10 years.
Both countries have completed transmission lines within their respective areas, with Pakistan completing a 29-kilometer transmission line within its territory.
Sources said that the Power Division has sought out federal cabinet’s approval of the MoU signed between Pakistan and Iran. Presently, Pakistan is importing 104MW of electricity to Balochistan’s bordering areas. With the addition of the 100MW, the total import of electricity will reach 204MW. Sources said Iran has also sought an update on an earlier understanding with Pakistan, according to which Iran will supply 5,000MW of electricity to Pakistan.
The article originally appeared on the China Economic Net
Published in The Express Tribune, March 21st, 2023.
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