NEPRA, Alternative Energy Board differ over upfront tariff policy

Energy board opposes relation between tariff and capacity utilisation.

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) and Alternative Energy Development Board (AEDB) have differed over linking the upfront tariff for wind power projects with capacity utilisation.

Nepra has decided that upfront tariff will be linked with net annual energy generation and its supply to power purchaser. The regulator has set Rs13.19 per unit upfront tariff for wind power projects having up to 31% net annual plant capacity factor.

Presiding over 27th board meeting of AEDB here on Thursday, Federal Water and Power Minister Dr Musadik Malik said Pakistan had great potential for renewable energy and it should formulate such policies that could attract and facilitate investors.

He asked AEDB to play its role as a one-window facilitator and work for stimulating investment in renewable energy projects.

He suggested that AEDB should take up with Nepra the upfront tariff policy, especially its link with capacity utilisation. According to sources, AEDB officials during the meeting said they had differences over the relation between upfront tariff and capacity factor.



During the deliberations, the AEDB board approved a six-month extension in the letter of support for Hydro China Dawood Power. It also decided to set up a committee that would negotiate with the Government of Sindh for the sub-lease of allocated land for the 50MW wind project.

An official said the Sindh government was reluctant to issue the sub-lease, citing restrictions placed by the Supreme Court in a judgment.

However, AEDB officials told The Express Tribune that the Sindh government had issued the lease to two firms but now the province was denying it. They pointed out that their case was old and the Sindh government should give the sub-lease for the wind power project.

Participants of the meeting said several companies had requested an extension in their letters of intent (LOIs) because of a delay in announcing upfront tariff.

According to a statement issued here, in a bid to speed up development of wind power projects, the AEDB was asked to submit proposals for extension in letters of intent on a case-to-case basis with valid reasons in the next meeting of the board.

Earlier, the AEDB CEO told the meeting that the cabinet had extended the renewable energy policy for another five years and the Economic Coordination Committee (ECC) had approved the policy framework for bagasse-based energy projects.

He underlined the need for promoting the employees on merit and called for submitting AEDB regulations in the next meeting on May 7.

Published in The Express Tribune, May 3^rd, 2013.

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