ISLAMABAD: K-Electric Limited (KE) has sought approval from the National Electric Power Regulatory Authority (Nepra) to retain Unit-5 of its Bin Qasim Power Station-I (BQPS-I) as a secondary reserve until 2030, citing rising electricity demand, geopolitical uncertainties and growing concerns over fuel supply security.
Thank you for reading this post, don't forget to subscribe!Nepra has issued a public notice inviting comments from stakeholders, interested parties and the general public on KE’s proposed modification to its generation licence under Regulation 10 of the Nepra Licensing (Application, Modification, Extension and Cancellation) Procedure Regulations, 2021.
In its application, KE stated that electricity demand across its service area is expected to increase steadily in the coming years. However, geopolitical uncertainties and the force majeure declared on Pakistan’s two RLNG terminals have raised concerns about the reliability of fuel supplies.
The company said fuel price volatility and supply-chain disruptions had further highlighted the need for greater fuel flexibility and enhanced energy security within its generation portfolio.
KE particularly emphasised the strategic importance of BQPS-I Unit-5 due to its dual-fuel capability, allowing it to operate on both natural gas and furnace oil. According to the company, retaining the unit would provide operational flexibility and help maintain reliable electricity supplies during potential fuel shortages and generation contingencies.
The proposed extension, however, would involve additional financial costs that could be passed on to electricity consumers through tariffs.
KE has requested Nepra to allow annual operation and maintenance (O&M) expenses of Rs152 million, including applicable indexation. It has also sought approval for working capital requirements of Rs73 million, subject to relevant indexation.
The company has justified these costs by arguing that retaining the unit would strengthen generation reliability, improve operational flexibility and reduce dependence on expensive high-speed diesel (HSD)-based generation.
KE further stated that the continued availability of Unit-5 would increase the operational capacity of its generation fleet and help manage contingencies, including disruptions in interconnection with the National Grid Company (NGC), forced outages of its own generation units and independent power producers (IPPs), and shortages of RLNG or natural gas beyond its control.
The company maintained that the proposed modification would improve its ability to fulfil generation licence obligations without adversely affecting the quality of service provided to consumers.
Nepra has invited stakeholders to submit comments either in favour of or against the proposed licence modification within 14 days of publication of the public notice.
The regulator has clarified that the submission and acceptance of KE’s application for consideration does not constitute approval of the proposed modification.
Nepra will examine the request in light of stakeholder feedback, its financial implications for electricity consumers and its potential impact on generation reliability and the overall cost of power supply.
Story by Mushtaq Ghumman
