‘PEPCO would be the controlling authority of the rental power plant’

The per unit cost will be Rs22 if the government does not offer subsidy.

KARACHI: The newly inducted ship-mounted rental power plant would be working under the authority of the Pakistan Electric and Power Company (Pepco), a Karachi Electric Supply Company (KESC) engineer said on Monday.

Soon after the plant was linked into the national grid system, many questions arose, creating ambiguity regarding the real beneficiary of the power plant ­— KESC or Pepco?

One can easily infer that the addition of the 220 megawatts (MW) would help the country — not the city — because Pepco will slash 220MW from its 650MW electricity supply to Karachi.

Pepco did not have its own transmission network in the city so they used KESC’s Qayyumabad grid station to induct the 220MW to the national grid, revealed the KESC engineer. “Its output will be injected into KESC’s system, after which the utility will use it.”

KESC spokesman Aamir Abbasi maintained, “This new project has been managed and imported by the government for the state-run Pepco and its distribution companies, which will run the plant and utilise its electricity. Therefore, there will be no additional power coming from this plant to Karachi consumers.”

The ship-mounted power-generation plant will consume furnace oil as the basic fuel round-the-clock. So in comparison to power generation from natural gas, this will give a bump to electricity tariff. But the government assures that they would offer a subsidy for the price increase, ensuring that the burden does not fall on the consumers.

Without the subsidy, the lowest tariff for electricity unit produced by the rental power plant would not be less than Rs22 per unit, the engineer said. “The rental power plant would not result in transfer of technology. It would increase the already-swollen fiscal liabilities [of the country],” he claimed.

However, Pepco director-general, energy management, Muhammad Khalid told The Express Tribune that the federal government has hired the ship-mounted power plant for a five-year period. “The country of origin has borne all the expenses — all the way from Turkey to Karachi,” he said. “We would [just] pay the rent and energy charges to the company which owns the plant.”

Feasibility

The federal authorities have yet to work out the pros and cons of the deal.

Presently, the power tariff for KESC’s non-commercial consumers is approximately Rs3 per unit for consumers using electricity up to 50 units; Rs5 for consumers using 50 to 100 units; Rs8 for those using 100 to 300 units; and Rs14 for consumers using over 300 units of electricity.

Published in The Express Tribune, November 23^rd, 2010.