Advice received to place anti-aircraft guns at Patrind Power Plant, claims SHPL

ISLAMABAD: Star Hydro Power Limited (SHPL) on Tuesday claimed that the “sensitive quarters” had advised it to place anti-aircraft guns at its 147-MW Patrind Power Plant in Azad Jammu and Kashmir to avert any sabotage activity.

The power company shared this information with National Electric Power Regulatory Authority (Nepra) during a public hearing on recovery of additional security costs of Rs 104 million for its Patrind hydropower project.

The Authority had approved its reference tariff and COD stage tariff through its decisions dated January 27, 2014 and July 29, 2022 respectively with the following levellized tariff i.e. EPC tariff Rs 7.0496/ kWh (Cents 8.2936/kWh) and COD tariff Rs 8.3924/kWh (Cents 8.3170/kWh).

CPPA-G in its letter of May 23, 2023 submitted a tariff application/petition for recovery of additional security cost for operation period of SHPL, which was admitted by the Authority on August 09, 2023.

SHPL submitted the Police Departments of AJ&K and KP had demanded an additional security cover that was required against the payments and accordingly agreements were signed with the Police Departments of AJ&K and KP which led to additional costs. Further, as a result of security audit carried by out Security a certain cost was also incurred.

Of the total amount of Rs 104 million, Rs 60 million was paid to Police Department AJ&K, Rs 32 million to Police Department KPK and Rs 12 million security audit by Security Agencies.

These security arrangements were for the term of the construction period and shall remain in effect during the operation period. The construction related period cost has been allowed by the Authority, however, the operational period has not been allowed.

SHPL requested that the incurred cost of Rs 104 million for the first five years of operation may be allowed as a pass-through item.

During the hearing, Mathir Niaz Rana, Nepra Member/ former Chief Secretary AJ&K raised questions on payment to AJ&K Police directly instead of Home Department and referred to a similar tariff petition of Laraib run of the river project. The Authority argued that the government had already allowed one per cent cost of security for CPEC projects.

However, the representative of SHPL claimed that the company was compelled to make arrangements for additional security to protect the project and Chinese workers, and requested the Authority to approve additional cost. He also claimed that the company had been asked to place anti-aircraft guns at the project to protect it from any mishap, maintaining that they can share the letter with the Authority.

The representatives of Private Power and Infrastructure Board (PPIB) opposed the approval of any additional amount in the name of security, adding the power company had already been allowed the required amount in the tariff.

After discussion for half an hour, the Authority reserved its decision to be released later. However, the mood of Authority seemed unfavourable to the power company.

Copyright Business Recorder, 2024