NEPRA Takes Notice Of Changes In Minimum Load Limits Of Two IPPs

National Electric Power Regulatory Authority Has Sought Reports From Concerned Regarding Revision In Power Purchase Agreements Of These IPPs.

By Ahmad Ahmadani

Taking Notice Of The Changes Made In The Agreements Of Two Independent Power Plants Namely AES Lalpir And Pakgen, National Electric Power Regulatory Authority Has Sought Reports From The Concerned Regarding Revision In Power Purchase Agreements Of These IPPs.

NEPRA, in a letter to Chief Executive Officer (CEO), Central Power Purchasing Agency (CPPA), said that revision in minimum loading of M/s PakGen and M/s Lalpir from 20 percent (70MW) to 50pc (175MW) has a direct impact on the consumers-end tariff therefore the Authority (NEPRA) has taken serious notice of the matter and directed CPPA to submit report in this regard within seven days of receipt of the NEPRA letter.

NEPRA, in its letter, has sought load position of Lalpir and PakGen power plants given in Power Purchase Agreements and copy of settlement agreement. Similarly, NEPRA has asked for the comments of system operator (National Power Control Center) on the matter, details of PPAs approving authority, provision of partial loading of the said plants (if any), and consideration of financial implications and the resulting impact on end-user tariff in terms of Fuel Cost Adjustment (FCA).

Earlier, CPPA’s letter No.10759-66 dated 28-042021 addressed to NTDC/NPCC copied to NEPRA, submitted that the amendments in PPAs of M/s Lalpir and M/s PakGen with reference to revision of minimum loading of the plants from 20pc to 50pc was due to a settlement agreement which resulted in resolution of the long awaited or disputed issues along with other commercial gains under win-win situation amongst the parties.

Sources in power sector said that a former Managing Director (MD) of National Transmission and Despatch Company (NTDC) Dr Khawaja Riffat Ullah had opposed with changes in minimum load of the two power plants and declared amendments in the minimum load of AES Lalpir and PakGen as contradictory to the concerned regulations and it would cause Rs 15 billion per annum loss to the national exchequer and masses as well.

NTDC in a letter to Chief Technical Officer dated 01-03-2021 said that there will be no adverse operational effect on national grid system from changing the minimum load limit of AES Lalpir and AES PakGen from 20pc to 50pc while any financial impact and legal aspect have to be considered by the power purchaser i-e CPPA.

Sources also informed that General Manager (System Operation), Engineer Ghulam Abbas Memon has informed the concerned office about his opinion on the matter, saying, amendments made in the PPA especially with regard to minimum limits of units is not in favour of reliable and economical system operation and would cause both technical & financial implications. It is pertinent to mention that the agreements with AES Lalpir and PakGen Power Plants were signed in November 1999 and February 1998 under power Policy of 1994 with approval of federal cabinet’s Economic Coordination Committee (ECC).

This news was originally published at Pakistan Today.

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