Long-Term Initiatives Will Help Combat the Situation

Better days are coming; Karachiites will just have to keep their fingers crossed. The new year –2024— may start bright and continue to shine throughout the years to come as K-Electric has devised a Power Acquisition Programme (PAP) to provide access to affordable power to its customers by focusing on the reduction of its power generation costs through induction of indigenous and renewable energy resources. The power Acquisition Program was submitted in Jan 2023.

The six-year program (FY 24 – FY 30) complements KE’s PKR 484 billion investment plan in Transmission and Distribution which has been developed and submitted for NEPRA’s approval and the generation selected under this Programme is by the availability of the grid and transmission capacities envisaged under the investment plan.

The PAP has been prepared in a manner to align with the national targets of increasing share of renewable energy in the generation mix by up to 60%, which has been formalized in the Indicative Generation Capacity Expansion Plan (IGCEP). The additional generation will enable K-Electric to meet the load and energy demand reliably and sustainably by maximizing the use of available indigenous resources. This Programme has been prepared with the prime objective of providing uninterrupted electricity at an affordable cost to every Karachiite.

As for indigenous resources, actual data on wind and solar has already been collected from the vicinity of K-Electric’s renewable corridors to predict the future energy generation and the annual generation pattern. The capacity utilization factor has been taken from Solar and Wind generation plants respectively.

As for the development of coal power generation, it is subject to the support of international technology providers and financiers. KE is currently engaging with all the relevant stakeholders to assess the viability of the development of coal-based projects and to acquire further clarity in this regard.

In parallel, KE is also actively engaged with Hydel developers of KPK and AJK, and in February the company signed an MOU with China Three Gorges South Asia Investment Limited (CTGSAIL) a major player in Pakistan’s energy market with generation assets over PKR 6 billion in the country..

According to the MoU clean, both companies are working to make affordable, and sustainable power available for people of Pakistan including K-Electric’s growing base of over 3.4 million customers.

K-Electric is similarly engaged with with Sindh Energy Department (SED) and the World Bank to develop a solar park with an aggregate capacity of 350 MW under the ambit of the ‘Sindh Solar Energy Project’ (SSEP). The purpose of this tripartite arrangement is to develop and implement sustainable, cost-effective, and competitive utility-scale IPPs in Karachi under a competitive bidding structure and to increase solar power generation and access to electricity in Sindh Province.

The provision of reliable, adequate, and affordable electricity is a prerequisite for the growth and development of the economy, and as an emerging economy, a country’s demand for electricity correlates with the GDP of the country. Accordingly, per capita consumption of electricity and access to electricity is used to express the socioeconomic strength of a country.

The per capita consumption of Pakistan is 6441 kWh compared to 1,2182 kWh in India. As such it was imperative to conduct planning in such a manner to ensure reliable supply, which is crucial for the economy and socio-economic development of Pakistan. The implementation of PAP Karachi, the economic hub, will usher in a new era of prosperity and development.

Meanwhile, K-Electric is in the process of conducting a Variable Renewable Energy (VRE) study to evaluate the extent to which renewables can be incorporated into KE’s network, without making a compromise to the reliability of the network. The proposed PAP assumes that all the suggested renewable projects, as delineated in this Programme, shall be incorporated subject to the outcome of the VRE study being conducted, and with no additional cost of development of spinning and contingency reserve and transmission augmentation which could differ from the Transmission System Investment Plan.

The proposed PAP provides the most prudent scenario of K-Electric’s long-term procurement planning with the addition of generation planned from different generation technologies, with the majority of the power coming from renewables i.e., Solar 900MW and Wind 200MW till FY 2030.

In addition to this, 82MW hydel is also proposed to be added to the generation mix in the year FY 2029. These additions will not only contribute towards lowering carbon emissions for the country, but also decrease our reliance on imported fuels, benefiting the national exchequer through reduced spending.

Global variations in the prices of these fuels also affect the cost of electricity generation, which are passed through to customers in the form of Fuel Charge Adjustments on a monthly basis. The inclusion of renewable energy may thus benefit the customers as well by reducing the monthly charges being applied.

This article is written by Khawaja Amer. He is freelance contributor and can be reached at [email protected].

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