The fairness will probably be offered out to potential traders from pleasant international locations for 10 years to generate $800m, say officers
- Plan to generate $800m for Diamer-Bhasha Dam financing.
- Military chief asks SIFC to take up plan for optimistic consultations.
- Divestment of venture based mostly on revenue sharing foundation: supply.
ISLAMABAD: The federal government has labored out a doable and distinctive technique below which it’s going to dole out 30% fairness of the Ghazi Barotha Hydropower Undertaking (GBHPP) to generate $700-800 million for financing the Diamer-Bhasha Dam.
To this impact, Chief of Military Workers (COAS) Gen Asim Munir has been sensitised and requested the Particular Funding Facilitation Council (SIFC) to take up this plan for optimistic consultations between stakeholder entities. The fairness will probably be offered out to potential traders from pleasant international locations for 10 years, prime officers informed The Information.
“The divestment of 30% fairness of the Ghazi Barotha Hydropower Undertaking can be based mostly on revenue sharing foundation,” official sources stated, including that the caretaker federal minister for water assets earlier briefed Gen Asim Munir in regards to the divestment of 30% fairness plan of GBHPP labored out by the Technical Wing of Water Assets Ministry.
He appreciated the plan and its proposed execution and requested the SIFC to start out consultations on this distinctive plan with the Energy Division, Finance Division and Nepra.
The Ghazi Barotha Hydropower Undertaking is the golden goose because it continues to generate electrical energy in the summertime and winter seasons with a median hydro technology of 800 MW.
The venture has the capability to generate 1,450MW and 1,450MW in the summertime, however within the winter, the technology of electrical energy fluctuates relying on water flows within the Indus River downstream of Tarbela Dam. Nonetheless, in the course of the peak time within the ongoing winter season for 4 hours, the venture nonetheless generates 1,450MW.
The GBHPP produces 6.7 billion items in a yr and the federal government would promote out electrical energy on to the export business of the nation below the CTBCM mannequin 450 MW, which is 30% of the entire hydro technology of the venture.
That is how this is able to be the pilot venture that may present electrical energy to the export business by utilizing the transmission and distribution system of NTDC and related DISCOs. This may cut back the present tariff of the export business manifold which can assist cut back the enter value of the business and enhance exports of the nation.
The tariff for the hydropower venture at present stands at Rs1.25 per unit, however the Water and Assets Ministry desires Nepra to extend its tariff to Rs10 per unit as a base tariff for 30% technology of the venture; it is sufficient to generate ample attraction to potential traders from pleasant international locations i.e. Qatar, Kuwait, UAE and Saudi Arabia.
If the regulator will increase its tariff as much as Rs10 per unit, the 30% fairness would generate $700-800 million and if it will increase to Rs20-25 per unit, doling out the 30% fairness would fetch $1.6-1.eight billion.
Nonetheless, below the plan, the authorities need Nepra to extend the bottom tariff of 30% technology of the GBHPP as much as Rs10 per unit. After that, the federal government would maintain aggressive bidding between export sector gamers searching for tariff charges above Rs10 per unit. If it will get carried out, will probably be a win-win scenario each for the export business and Ghazi Barotha Hydropower Undertaking administration and international traders.
Nonetheless, the Energy Division confirmed reluctance to the proposal in the course of the session course of, arguing that the export business was offering an enormous cross-subsidy to residential and agriculture shoppers at about Rs10.85 per unit below the present tariff regime, which can come to an finish if the stated plan is carried out below the CTBCM mannequin.
Extra importantly, NTDC is searching for wheeling expenses or transportation expenses of electrical energy at Rs27 per unit and that’s meant to fail the CTBCM mannequin.
Initially printed in The Information