Awarding 747 megawatts plant contract without approval: Ecnec constitutes body for fixing responsibility

Executive Committee of National Economic Council (Ecnec) has constituted a high-level inquiry committee to fix responsibility on those guilty of awarding contract of the Rs 60 billion 747 MW Combined Cycle Power Plant at Guddu without its approval. The sponsoring agency of the project is Ministry of Water and Power, whereas executing agency is Central Power Generation Co Ltd (GENCO-11).
Sources in Planning Commission revealed that the committee would be headed by Minister for Industries and Production, while Deputy Chairman Planning Commission, Secretary Finance, Secretary Water and Power and Secretary Planning and Development Division would be its members.
During consideration of a summary submitted by Planning Commission on "747 MW Combined Cycle Power Plant at Guddu" in a meeting held on January 21, Ecnec was informed that letter of support (LoS) had been issued for a contract that was pending for its approval. Ecnec took serious exception to this departure from existing government policy and directed the Committee to submit a report within two weeks for consideration.
Ecnec further directed that services of Infrastructure Project Development Facility (IPDF) should be utilised for public private partnership (PPP) in all such projects to lessen burden on government resources. PPP should also be made mandatory in all such projects.
The apex body was informed that the project was considered by the CDWP on November 19, 2009 and recommended for the approval by Ecnec at an estimated cost of Rs 59775.41 million including foreign exchange component (FEC) of Rs 45472.75 million subject to the condition that project will be financed by Pakistan Electric Power Company (Pepco) under an already agreed Chinese loan agreement.
The CDWP also advised that the possibility of financing a similar plant by a public limited company might be explored to reduce PEPCO's burden and increase generation capability. The foreign exchange rate as per PC-1 was taken at Rs 83 per dollar. However, cost estimates have been revised upward on the basis of the current exchange rate.
According to the summary tabled before Ecnec, a consortium of Chinese Exim Bank and US Exim Bank would provide financing for the 747MW Combined Cycle Power Plant at Guddu. Chinese Exim Bank would provide 25 percent of the cost of Chinese origin equipment, 35 percent of the cost of US origin equipment will be met by US Exim Bank and 40 percent by GENCO-11 (15 percent advance payment + local component).
The operation cost has been projected at Rs 3.23 per kWh and the project will be completed in 36 months. The main objective of the proposed project is to install combined cycle power plant of 747 MW capacity comprising two gas turbines of 261 MW each, two heat recovery steam generators and one steam turbine unit of 225 MW. This plant will operate on gas by diverting gas quota of existing steam units (1-4) of power complex at Guddu.