KE seeks early retirement of SGTPS, KTGTPS

ISLAMABAD: K-Electric Limited (KE) has sought modification in its generation licence for early retirement and decommissioning of two thermal power plants without compromising its ability to discharge obligations.
In an application to NEPRA, KE said that its proposed early retirement / decommissioning of the Site Gas Turbine Power Station (SGTPS) and Korangi Gas Turbine Power Station (KTGTPS) will not adversely affect the quality of service or KE’s ability to meet its demand—supply obligations, as elaborated in Part B of this document
According to the statement of reasons and Specification in Support of KE’s request upon privatization of KE in 2005, under the Implementation Agreement (IA) signed between KE with the Government of Pakistan (GoP) subsequently amended through the Amendment Agreement signed in 2009, SGTPS and ICGTPS plants were added to KE’s generation portfolio in 2009 comprising of 32 engines of 3.041 MW each (Gross ISO Capacity).
These are gas-based power plants and explicit commitments / allocations were made by the GoP for supply of local gas to these power plants from SSGC. Subsequently, to further enhance efficiency, in 2016, Steam Turbine (ST) of 10MW each was added at these power plants. Until 2018, gas supply made to these power plants was sufficient for their optimum utilization, however, owing to depleting reserves of natural gas in the country, supply of local gas to these power plants at adequate pressure started to dwindle. Accordingly, considering the ground reality and for effective utilization of these power plants, as per the directives of the Cabinet Committee on Energy (CCoE) dated April 23, 2018, KE agreed to off-take RLNG supply for its power plants, including SGTPS and KTGTPS. from SSGC. However, even after the shift to RLNG, optimum supply of gas at required pressure has remained a challenge, especially over the last2years. Meanwhile, to manage the growing power demand, KE added a state-of-the-art 900 MW BQPS III power plant along with investments in interconnection capacity enhancement, increasing the interconnection capacity for off-take of supply from National Grid to over 2.000 MW and for which KE has entered into a long-term Power Purchase Agency Agreement (PPM) with CPPA-G and an Interconnection Agreement (ICA) with the National Grid Company (NGC).
KE has submitted that the proposed modifications will not have any adverse impact on consumer tariffs, infact, consumers will benefit as capacity payments will not be passed onto the consumers.
The early retirement and decommissioning of SGTPS and KTGTPS plants will neither compromise KE’s ability to discharge its obligations under the license, nor affect KE’s ability to meet its demand-supply obligation.
In this regard, KE reiterated that the Company has already taken concrete steps for adequate supply for its consumers through the addition of 900 MW efficient generation and enhanced interconnection capacity for increased off-take from the National Grid. Accordingly, KE certifies that service quality and reliability will remain unaffected by this modification, and the Authority may be assured that the request is aligned with KE’s commitment to provide reliable and affordable electricity to its consumers. Ends