The government has announced the signing of a ten-year contract for the Nandipur power project. The Chinese Firm, as per the contract will operate and maintain the project. The ministry did not share details of the contract price.
Details of Nandipur Power Project Made Public
The Water and Power Ministry issued a statement that it has reached a long-term agreement for operation and maintenance of the project. Hydro Electric Power System Engineering Company (HEPSEC) of China is selected by the Water and Power Ministry to run the project. The contract for the Nandipur project will remain valid for ten years.
A key component of the pricing was the cost per unit not disclosed by the ministry. Nepra (National Electric Power Regulatory Authority) previously permitted 48 paisas per unit price.
A total of four companies took part in the bidding process. Two of these four participating companies were declared non-responsive. The ministry revealed HEPSEC as the lowest bidder with a total cost of $ 185 million. TNB Repair and Maintenance of Malaysia placed the second lowest bid of $ 227 million for this contract.
The experts worked out the cost per unit of electricity produced as per this new contract to be around 85 paisas per unit.
The per unit cost of electricity generated is much higher than previously allowed by Nepra. The Water and Power Ministry would have to get these tariffs approved from Nepra.
The new contract, according to the Water and Power Ministry makes it mandatory for the Chinese company to hire at least 25 percent local workforce. The company is also supposed to provide training to the locally hired resources., The company is expected to maintain a plant efficiency of 44 percent to avoid getting penalized.
Nandipur power project has been in the media limelight for closures and shutdowns. Water and Power Ministry claims the plant is fully operational since July 2015 and has since been running on furnace oil.
Nandipur power project has proven to be one of the most controversial projects so far. This new contract will hopefully overcome delays and cost overruns to get rid of the ongoing electricity crises in Pakistan.