With new tariffs, sponsors look to revive cogen plant

The company will discuss its proposals at a public meeting tomorrow.

KARACHI: More than two years after it was shut down, the sponsors of the controversial DHA Cogen plant are hoping to resurrect the dead power-cum-desalination project with new electricity and water tariffs, officials said on Monday.

At a public hearing tomorrow (Wednesday), the company will determine the electricity tariff, which it has proposed at Rs6.9 per kilowatt hour.

DHA Cogen - a combined cycle power generation and seawater desalination plant - was inaugurated by former president Pervez Musharraf in February 2008. It was supposed to generate 80 megawatts (MW) of electricity in addition to making seawater drinkable. With a capacity of three million gallons per day (MGD), the attached desalination unit was to meet the growing water needs of the residents in Defence House Authority (DHA). But after many fits and starts over a period of five months, the plant was bogged down in controversy over its faulty machines and poor maintenance.



Soon after the plant was inaugurated, Sacoden Investments sold off their share to a US-based firm, AEI Energy. What followed was a disaster. The AEI found faults in the plant and felt “cheated”. Arbitration followed and it was decided in favour of the US-based company. “Now we have wooed in US-based International Electric Power to run and maintain the plant,” said Khalid Nazir, a local representative of AEI Energy.

The cogen plant will become operational after an investment of $51.5 million, most of which will go in paying off existing loans, according to National Electric Power Regulatory Authority. “I am glad OPIC (Overseas Private Investment Corporation) has agreed to lend us the money,” added Nazir.

Cogen plant only way to end water woes

For the residents of DHA, the DHA Cogen is the only way to address their water woes. “There is no denying how important this has become for us,” said Asad Kizilbash, a senior member of the Association of Defence Residents. According to him, the entire DHA area receives just seven MGD against its requirement of 14MGD of water.

“This plant will give us just three MGD. There is a need to add more desalination plants in the coming years.”

Published in The Express Tribune, November 27^th, 2012.