KARACHI: The Overseas Investors Chamber of Commerce and Industry (OICCI) has recommended the Government to continue the co-generation captive power setup for process chemicals plants for their safe and sustainable operations.
In a letter addressed to Musaddik Malik, Federal Minister of Energy (Petroleum Division), and Jam Kamal Khan (Federal Minister of Commerce), the OICCI has expressed concern regarding the recent government decision to transition all captive power plants to the grids of power distribution companies/ Karachi Electric (KE).
It has highlighted that petrochemical and chemical plants in Pakistan rely on captive power infrastructure, particularly co-generation/combined cycle power plants (CCPP), to meet their electricity and steam requirements. This configuration ensures both energy efficiency and operational reliability for continuous functioning of these plants.
“Transitioning these plants to the grid would only meet electricity needs but fail to provide the necessary steam, reducing overall efficiency and increasing natural gas consumption to generate steam separately”, the letter states. The high-pressure steam is an inherent feature of these CCPPs and critical for chemical processes.
As part of the International Monetary Fund (IMF) package, the Government is planning to phase out captive power plants from the gas grid by January 2025. However, the move is expected to have wider implications for the economy as industries had invested heavily in captive power generation to ensure uninterrupted production, especially during periods of power grid instability, and generate steam as part of critical manufacturing processes.
The OICCI has also pointed out that the current grid infrastructure of electric supply companies is not capable of consistently meeting the high power quality demands of these industrial units. Any power interruptions or fluctuations in voltage and frequency could lead to plant shutdowns, which typically require 5 to 7 days to restart. Thus, the operations of these plants could be severely jeopardized, while also posing potential safety risks of hazardous gas releases and equipment failures.
In view of the complexity, safety concerns, and the essential steam requirements for chemical processes, the OICCI has recommended that these plants be allowed to continue with their co-generation captive power setup rather than depending on the grid. Further; currently no comparable process plants are connected to the grid and, in some cases, even the required infrastructure is not available.
Copyright Business Recorder, 2024