KARACHI – The Karachi Electric Supply Company (KESC) on Sunday lost 50 megawatts (MW) electricity supply from rental power plants installed at the SITE Gas Turbine Station and West Wharf. With the closure of these units, fears abound of at least 14 hours of power load shedding from Monday since the Sui Southern Gas Company (SSGC) is also set to reduce gas supply on account of repairs in Bhit Shah gas field.
The 50MW were being generated by a Dubai-based company, M/S EGRICO; the company was utilising 50 generators, each with a generating capacity of 1MW. Sources privy to the power situation alleged that the KESC had stopped seven of its gas-based turbines that could generate at least 130MW in an attempt to facilitate the rental one.
KESC Chief Financial Officer (CFO) Tayyab Tareen confirmed to Pakistan Today that the company has stopped getting supply from the rental power plants, but claimed that this was because the two-year-long contract with the Dubai-based generation company, M/S EGRICO, had now expired.
In truth, the KESC can no longer afford to pay the rental power company: the power utility has been paying $ 2.8 million per month to EGRICO for 50MW since 2009, sources explained, even though it had been offered a lower rate by a Pakistani generation company.
“As per the agreement with EGRICO, KESC was buying 50MW power at the rate of 5.08 cents per KW. A cheaper offer was on the table, and had been made by a local firm named PROGAS; they had offered to generate power for 3.80 cents per KW,” sources said, explaining that the power utility was to pay Rs 4.00/KW per hour, or Rs 2.0 million per hour.
Not only did the KESC ignore the local company’s offer, it also paid transportation charges and custom duty on all 58 generators to be run by EGRICO, as well as $1.2 million in advance. Provision for gas, water and land were also made by the KESC.
Combined with reduction in gas supply from the SSGC, the closure of the rental power plants now means that citizens now have to brace 14 hours of power outages from Monday. “The only way out is for the KESC to start operating its gas-based units in Haroonabad and utilise the gas available in the area,” sources said.
It is worth mentioning, however, that the KESC has already filed a petition with NEPRA to decommission the existing gas-based units in the area over “non-availability of gas and lower efficiency of the plants.”
