Pursuant to 1994 and 2002 Power Policies, PPIB attracted leading international investors and lenders to invest in country's power sector and has successfully managed to induct 30 independent power projects (IPPs) totaling 7,410 MW with cumulative investment of around US $8.5 billion, which is an accomplishment that makes PPIB stand out in the country's power sector. Subsequently, 1638 MW KAPCO earlier a public sector entity joined the league of IPPs after being privatised; currently more than 50% of electricity is fed into national grid by these IPPs.
PPIB achieved a major landmark with the commissioning of 84 MW New Bong Escape Hydropower Project in July 2013, which is the first ever hydro IPP established in the country. The commissioning of this project showed confidence of investors on PPIB's hydel framework and has opened new avenues for the development of number of new hydropower projects in the private sector, which are currently at different stages of development including 147 MW Patrind and 100 MW Gulpur IPPs which are already at advance stage of construction.
Since the inception of present democratic government, PPIB has been playing most crucial role to fulfil government commitment to overcome the menace of load shedding from the country by adding sustainable and affordable power generation to the national grid. The government has introduced Power Generation Policy 2015 with the assistance by PPIB to attract the new investment in the power sector to bridge the demand supply gap. The Policy offering investor friendly framework and competitive incentives to the Investors received overwhelming market response, which is evident from the fact that currently PPIB is handling largest portfolio since its creation ie more than 19,200 MW consisting of thirty one 31 multiple fuel (coal, hydro, R-LNG/Gas) based IPPs worth multi billion dollars. These include sixteen hydro IPPs of 6,363 MW, eleven coal based IPPs of 9,093 MW and four Gas/R-LNG based power projects of 3,763 MW. These projects are at different stages of implementation, some are under construction, some are about to start construction, while others are under Financial Closing.
During the last two years period, PPIB facilitated a number of new IPPs based on multiple fuels with cumulative capacity of more than 13,000 MW by issuing LOI, LOS and declaring achievement of Financial Closing. The present target is to complete and commission eighteen IPPs of around 14,000 MW during next five years to supply reliable, affordable and sustainable electricity to the national grid supporting the country to achieve its economic goal and electricity is the universally recognised as engine for economic growth.
PPIB is working as front line institution of government to bring additional power generating capacity with the aim to improve energy mix in power generation through blend of imported and indigenous fuel/resources for upcoming IPPs. A number of imported coal based projects are being processed to meet the country's immediate electricity shortfall, whereas at the same time to trade-off the anticipated impact on foreign exchange reserves due to imported fuels, numerous hydro and local coal projects are also under development to cater the long term electricity requirements of the country.
PPIB is also putting all its efforts to meet the present government's agenda of harnessing the Thar coal potential for power generation, which can be seen from the fact that it is currently handling seven IPPs of 4,970 MWs based on Thar Coal. Recently, country witnessed another historical landmark when PPIB declared achievement of Financial Close for the first 660 MW Thar coal based project sponsored by Engro Powergen. This is a major breakthrough in the power generation history of Pakistan, the achievement of Financial Close and construction start for this first ever IPP based on Thar coal will act as a catalyst for development of Thar coal field and power generation based on Thar Coal.
PPIB is frontrunner institution in implementation of flagship China Pakistan Economic Corridor (CPEC) initiative processing major chunk of power generation and transmission projects under CPEC framework including eight coal based power projects of 7,920 MWs and three hydropower projects of 2,714 MWs worth more than 17 billion US$. PPIB has been actively monitoring the progress of these projects and providing its full support to the Sponsors to ensure smooth and timely completion of projects. Two coal based IPPs each of 1,320 MW by Huaneng Shandong (Ruyi) at Sahiwal and by Sinohydro Resources Limited/Al Mirqab Capital at Port Qasim are at advance stages of construction and are expected to come online during 2017-2018.
First time in Pakistan, PPIB has been facilitating transmission line projects through private sector in line with the Government of Pakistan Policy Framework for Private Sector Transmission Line Projects, 2015 prepared with the assistance of PPIB to attract private sector investment for augmentation of transmission network in the country to transmit electricity from upcoming power projects to the load centres of the country. Currently, PPIB is facilitating ±660 kV Matiari-Lahore HVDC (High Voltage Direct Current) Transmission Line Project being sponsored by China Electric Power Equipment and Technology Company Limited (CET), a subsidiary of State Grid Corporation of China (SGCC). This Project is not only first transmission line project being developed by the private sector but it will also be first ever HVDC transmission line in Pakistan. The HVDC transmission system offers many advantages for power transmission over longer distances in terms of more transmission capacity, lesser losses and cost effectiveness etc. This project will open a new horizon through introduction of HVDC technology in Pakistan and provision of training and development of skills of local professional to implement and operate such project in Pakistan in future.
To remove the major bottleneck in the development of power projects in the private sector through provinces, particularly the small hydro projects, PPIB has started issuing tripartite Letters of Support for project being processed by province. This will open door for development of small to medium power projects based on local resources.
PPIB is putting in untiring and unprecedented efforts to meet the challenging and ambitious timelines of the current government for addition of huge quantum of power generation capacity in the national grid within few years to eliminate load shedding from the country, which will be a game changer for the country. This is evident from the fact that the target to commission 14,000 MW in next five years is double of the total capacity addition made during 22 years through PPIB's facilitation. In the process PPIB has continued to facilitate and transfer the professional expertise to other institutions such as the provincial entities and has been working very closely with the federal and provincial institutions to remove the bottleneck and fast track the implementation of projects. PPIB is playing a vital role in meeting the future electricity requirements of the country through bringing in affordability, sustainability and improvements in electricity supplies for the socio-economic development of the country.
(The writer is Managing Director, Private Power & Infrastructure Board)