ISLAMABAD: K-Electric (KE) has sought regulatory approval to retain its 210-megawatt Unit 5 at Bin Qasim Power Station-I (BQPS-I) as a secondary reserve until June 30, 2030, despite the plant’s age and lack of installed emission-control equipment.
Thank you for reading this post, don't forget to subscribe!The 35-year-old Hitachi unit, commissioned in 1991, can operate on natural gas, furnace oil and imported liquefied natural gas (LNG). Under KE’s proposal, it would primarily remain on standby and operate during emergencies or when its generation is considered more economical than available alternatives.
The utility has argued that retaining the unit is necessary to strengthen electricity supply security amid geopolitical uncertainties, fuel supply disruptions and the force majeure declarations at Pakistan’s two LNG terminals. It has also highlighted potential disruptions in national grid connections, outages at other power plants and reduced gas pressure.
KE’s demand projections indicate that Karachi’s night-time peak electricity demand could increase from 3,988MW in FY2027 to 4,202MW by FY2030, while available supply is expected to remain around 3,998MW. This could create a potential supply shortfall of approximately 204MW by FY2030 if no additional capacity becomes available.
However, the proposed extension raises questions about the financial and environmental implications of keeping an ageing power generation unit operational.
KE has estimated annual operation and maintenance (O&M) expenses at Rs152 million, along with working-capital requirements of approximately Rs73 million. The combined costs could translate into an estimated tariff impact of Rs0.01 per kilowatt-hour, based on the assumption that the unit operates only 10 per cent of the time.
The application also contains inconsistencies in its working-capital calculations, referring to figures of Rs392 million and Rs734 million before arriving at the estimated Rs73 million requirement. These discrepancies could require clarification during Nepra’s assessment.
Environmental concerns have also emerged, as KE’s technical documentation acknowledges that the plant has no emission-control equipment installed. The filing also leaves the unit’s emissions data unspecified, raising questions about its environmental impact if its operating life is extended by another four years.
KE, however, maintains that retaining the unit could help reduce generation costs during emergencies. Its estimates put electricity generation from Unit 5 using furnace oil at Rs53.8 per kilowatt-hour, compared with Rs84.1 per kilowatt-hour using high-speed diesel (HSD).
The company has also cited several technical improvements undertaken over the past decade, including boiler-coil replacements, installation of a modern control system and turbine overhauls. These upgrades, according to KE, support the unit’s continued reliable operation through FY2030.
The proposal places the focus on balancing electricity supply security, generation costs and environmental considerations. Nepra will need to examine whether retaining the ageing unit as a secondary reserve is justified and whether its associated fixed costs should be passed on to Karachi’s electricity consumers.
Story by Israr Khan
