National Electric Power Regulatory Authority (Nepra) has approved Rs 0.3727 per unit Wheeling charges for Sindh Transmission and Dispatch Company (Private) Ltd (ST&DCPL) for the determination of tariff for 132 KV Transmission Line Project. The Authority has approved O&M cost of Rs 0.1404 per unit, insurance, Rs 0.0185 per unit, RoE, Rs 0.0603 per unit, and debt servicing, Rs 0. 1535 per unit, totalling it to Rs 0.3727 per unit.
In its petition, the ST&DCPL claimed an EPC cost of Rs 1.670 billion while stating that lump sum, fixed price and date certain EPC contract has been signed with the EPC contractor covering whole scope of work during the EPC phase. The ST&DCPL submitted that to select the EPC contractor, two stage bidding was carried out in accordance with the Sindh Public Procurement Regulatory Authority Rules, 2010. The GoS formed a committee dated March 04, 2015 comprising ST&DCPL employees, representative from Finance Department and a co-opted member. Notice inviting tender was published in the newspapers on March 08, 2015 stating that ST&DCPL intends to invite sealed tenders from EPC contractors for installation of Double Circuit 132 KV transmission line from 100 MW power plants located at Nooriabad, owned by SNPCL and SNPCL-II, and 100 MW of wind power plant owned by Sindh Renewable Energy Department Limited to grid station, located at KDA Scheme 33 or Mayrnar or Gadap, owned by K-Electric Limited. The estimated EPC cost specified in the aforementioned advertisement was Rs 1,100 million. Subsequently, a corrigendum was published by ST&DCPL on March 10, 2015, ie with a gap of two days, through which the earlier advertised estimated cost of Rs 1,100 million was changed to Rs 1,300 million. In addition, the services of O&M contractors were also invited initially for five (5) years of operation of this project through the said corrigendum.
The ST&DCPL submitted that in response to the aforesaid advertisements, following four companies purchased the bidding documents; (i) North East China International Power Corporation (NECIPC); (ii) Technomen Kinetics Private Limited (TKPL); (iii) Al Hussain Traders; (iv) and ICC Pvt Limited. As per the bidding, the EPC contract was around Rs 1,275 million. However, later the amount claimed in the petition submitted to the Authority was the bid amount ie Rs 1,275 million plus the variation of Rs 395 million (ie total amount of Rs 1,670 million) estimated by the petitioner till the time of hearing. Subsequently, the petitioner further changed it claim to Rs 1,783 million vide its letter dated June 10, 2016 and then again to Rs 1,823 million vide its letter dated August 26, 2016.
The petitioner during the hearing as well as in its subsequent communications submitted that it erroneously stated in the petition that the contract was of fixed amount. The company further submitted that it was mentioned in the Bill of Quantities (BOQs) that quantities of items stipulated in that document are tentative and may vary which is the reason for the claim of variations over and above the bid amount. Explaining and justifying the change in its EPC claim to Rs 1,823 million, the ST&DCPL submitted that 130Qs which were prepared in the very beginning were tentative in order to speed up the process for laying the transmission line to match with the timing of the power plants.
The ST&DCPL, vide its petition, claimed a variable charge of Rs 0.1492/kWh which has been computed by applying a loss percentage of 3% on the energy cost component of Rs 4.9744/kWh; claimed by SNPCLs in their petition. In support of its claimed toss of 3%, the ST&DCPL submitted that the losses assumed in the petition are in line with what has been allowed in Nepra Guidelines for determination of Consumer End Tariff Methodology and Process, 2015. The NTDCL submitted that the petitioner has proposed 3% losses as a thumb rule whereas these losses are determined during the planning phase while conducting load flow studies, short circuit studies and stability studies on PSSE. Although reportedly load flows and shot-circuits were carried out by M/S Siemens but no stability studies were carried out before taking this project in hand which is a serious omission on the part of ST&DCPL. The Authority observed that ST&DCPL has claimed 3% transmission losses taking into account the maximum limit of losses set by Nepra for the whole system network for transmission. After analysis, the Authority believes that that the project under consideration is a 132 KV dedicated transmission line comprising of Aluminum Conductor Steel Reinforcement (ACSR) Rail Conductor for which level of technical losses should reasonably be in the range of 0.8-1%. In view thereof, the Authority has decided to cap the loss threshold for ST&DCPL at 1%. After analysis of arguments and available documents, the Authority has approved tariff of Rs 0.3727 per unit for the ST&DCPL.
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