According to a letter written by Nepra, Tapal Energy (Private) Limited (TEPL) is a RFO-based IPP of 126 MW established under Power Policy 1994 having a 22 years PPA with K Electric (KE) for sale of power from its generation facility. The PPA will expire on June 19, 2019. Both the parties to the PPA are willing to extend the PPA for further five years with effect from June 20, 2019. Accordingly, TEPL filed a tariff petition for determination of generation tariff for the proposed extended term of five years. The TEPL vide letter dated May 22, 2019 received on May 28, 2019 also requested to allow provisional tariff during the pendency of tariff determination proceedings. The petitioner emphasised that a provisional tariff in this situation will avoid any interruption of power to KE from June 20, 2019 onwards. The KE also showed similar concerns and supported the petitioner''s request for allowing a provisional tariff for the interim period till the Authority announces its decision on the petition. The hearing in the matter of tariff petition was held on June 18, 2019.
During the hearing, all the stakeholders except KE expressed strong reservation on the extension of the PPA term for further five years and requested the Nepra not to extend the term as it is low efficiency RFO-based power plant which generates costly energy. The stakeholders requested that many efficient power plants have been added to the national grid which are currently underutilised, therefore, in the overall interest of the country, the equivalent power of 123.5 MW may be provided to KE by national grid. The Authority is also of the opinion that the 123.5 MW can easily be provided to KE through national grid on the payment terms to the satisfaction of the CPPA-G. This will reduce the burden of capacity charges to the extent of 123.5 MW and will be beneficial to all the electricity consumers in the country.
"In view thereof, you are advised to direct CPPA-G to look into the matter. Considering the urgency of the situation, the Authority would appreciate if response in this regard is provided till Monday, June 24, 2019," said the letter.
