20000108

Tarbila, Mangla

closure may

lead to cuts

in IPPs' tariff

RECORDER REPORT

KARACHI: With the closure of two key state-owned hydel power generation plants, the tariff of independent power projects (IPPs) would come down, as they are expected to run at their optimal capacity.

Since the Tarbela and Mangla hydel power stations have been closed on account of water scarcity, Wapda's dependence on IPPs would subsequently increase leading them to invoke their maximum capacity. The maximum plant capacity utilisation entails substantial cuts in the overheads of the IPPs. Under the price accords, Wapda has signed with the IPPs, this decrease is passed on to the buyer (Wapda) by the IPPs, sources on Friday said.

According to them, the tariff cut may variably reach 5-5.50 cents at an average from 6.1 cents, at present charged by the IPPs in operation. The major benefit would come to Wapda from Hubco, which usually runs under capacity, and Wapda has to pay capacity charges.

The effect would further deepen in the case of those IPPs, which have signed their tariff agreements with the government anew, sources said. But since, most of them have not commenced commercial operation, they would be irrelevant, sources said.

The installed capacity of Wapda power system stood at 13,716 mw. Of this capacity hydel power generation constitutes 4825 mw which accounts for 35.20 percent of the total capacity of Wapda. Wapda has been buying 3,771 mw power from IPPs including the 1,292 mw Hubco; Kohinoor Energy 131 mw; and the two separate power plants of AES carrying generation capacity of 366 and 365 mw each.

The Long dry spell in the country, is causing havoc with not only irrigation but power sector also. The water reservoirs of the hydel power plants have come down drastically, forcing Wapda to close its operation their.