PAEC Likely to Default on Loan Repayment as Nuclear Plants Face Financial Crisis

According to a Business Recorder report, operations of nuclear power plants and repayment of foreign/local debts have become difficult in the absence of required payment by the Central Power Purchasing Agency – Guaranteed (CPPA-G). As per the report, the Strategic Plans Division (SPD) has urged the concerned stakeholders to hold an inter-ministerial meeting to discuss and address the evolving situation.

Nuclear power plants are being managed under the National Command Authority-approved Nuclear Power Vision 2050, which envisages the generation of over 40,000 MW of electricity by 2050. So far, six power plants (four at Chashma and two at Karachi) are contributing around 3,500 MW of baseload electricity to the national grid. To achieve future targets, preliminary work planning is underway for the C-5 project (1,100 MW), Chashma Engineering Complex (Fuel Fabrication Plant), and Indigenous Nuclear Power Plant (340 MW). These projects are to be funded by revenues from operating plants and Chinese loans.

However, over time, these power plants met with financial constraints due to outstanding payments. The matter was highlighted to concerned quarters several times but there was no substantial improvement in the situation.The report maintains that the prospective situation is likely to aggravate, which may lead PAEC to default on foreign loans repayment, especially on K-2/ K-3 projects.

It advises the government to treat nuclear power plants differently as compared to IPPs and Gencos, as nuclear power plants are closely monitored and reported upon by International Atomic Energy Agency (IAEA).

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