Rs370bn investment proposed for national grid expansion

The National Transmission and Despatch Company (NTDC) that runs the country’s national grid has sought approval for a Rs370 billion investment plan for system expansion and loss reduction over the next three years (2023-25).

In a petition to the National Electric Power Regulatory Authority (Nepra), the transmission system operator stated that the proposed investment was required to meet the needs of an expanding transmission network with the induction of new power plants and technologies to various parts of the country, rehabilitation of existing system and need for new technologies to contain losses.

It said about 45pc (Rs167bn) of its investment would be utilised over the three years for power evacuation projects as new power plants achieve commercial operations while another 43pc (Rs158bn) investment would be used in removing system constraints through rehabilitation, upgradation and expansion of the national grid.

The remaining 12pc investment would be used equally (6pc each) for new special industrial zones of Dhabeji, Haripur, Swabi, Lahore and Faisalabad under the China-Pakistan Economic Corridor (Rs24bn) and protection upgradation and use of the latest equipment for system conversions like from 220kV to 500kV and so on (Rs21bn).

The company that evacuates power generation from all power plants and delivers to distribution companies across the country said it would spend a total of Rs114bn in FY23, Rs145bn in FY24 and about Rs110bn in FY25.

Of the total Rs370bn, about Rs165bn would be utilised in Punjab, followed by Rs135bn in Khyber Pakhtunkhwa, Rs23.5bn in Sindh and Rs12bn in Balochistan besides Rs34bn in other areas and sectors.

It said the Rs266bn investment over the previous investment period (2018-19 to 202-22) helped reduce its transmission and transformational losses from 2.9pc to 2.6pc the country was now better placed when compared to regional peers like India and Bangladesh and very close to 2.5pc in Sweden and Ukraine etc.

The performance of loss reduction in the national grid, it said, was improving consistently over the last three years and hence required additional investments to build upon the progress and to sustain.

The NTDC is required under the law to produce the transmission investment plan based on a 25-year load forecast, Indicative Generation Capacity Expansion Plan (IGCEP) and the Transmission System Expansion Plan (TSEP) along with annual system reliability assessment and improvement reports.

With the use of state-of-the-art generation planning and optimisation tools and adherence to global best practices, NTDC has already submitted IGCEP 2022 – 2031 in September.

It said the performance of the NTDC system concerning losses was improving but at the same time, the marginal positive impact of NTDC projects on T&T losses was partially offset due to load growth. The average monthly net delivered energy to Discos through the national grid has increased by 25pc from FY18 to FY22.

Nepra has accepted the petition for a public hearing on Jan 2, 2023 to examine if the claimed investment of Rs370bn for a multiyear tariff control period was justified based on project-wise rationale and techno-commercial benefits to be achieved in terms of constraints removal, additional energy available for wheeling, reliability and continuity of supply, reduction in transmission losses.

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