FY17-18: Gencos cost exchequer billions of rupees: Nepra

The data submitted by Gencos for FY 2016-17 and 2017-18 reflects that a number of units/machines of different power stations of Gencos failed to ensure net capacity as approved by Nepra in their respective tariff determinations (upon which they are receiving capacity payments). This resulted in a cumulative energy loss of about 479.573 million kWh, translating into a financial impact of Rs.4.025 billion,

These units include units 1 to 4 of TPS Jamshoro (GENCO-I), units 3, 5, 6, 11 & 12 of TPS Guddu & unit 15 of Guddu 747 CCPP (GENCO-II), units 1, 4 & 5 of TPS Muzaffargarh, unit 9 of GTPS Faisalabad, unit 2 of SPS Faisalabad & Nandipur Power Plant (GENCO-III) and units 1 & 2 of Lakhra Power Station (GENCO-IV).

The data submitted by Gencos for FY 2016-17 and 2017-18 indicates that a number of units/machines of different power stations of Gencos I, II & III availed higher outage hours than the allowed limit as specified in their respective Power Purchase Agreements (PPAs) , resulting in reduction of their availability factor.

"Had these units not availed higher outage hours, a huge amount of energy - around 9373.003 million kWh could have been contributed by them to the national grid (subject to dispatch by the system operator), amounting to Rs. 64.629 billion," the performance evaluation report added.

These units include Unit 2 of TPS Jamshoro & units 3 & 5 of GTPS Kotri (GENCO-I), units 1, 2, 4, 7, 8, 9, 11 & 13 of TPS Guddu & units 14, 15 & 16 of Guddu 747 CCPP GENCO-II) and units 4, 5 & 6 of TPS Muzaffargarh, unit 1 of SPS Faisalabad & Nandipur Power Plant (GENCO-III). CPPA-G has imposed liquidated damages amounting to Rs. 2.093 Billion on GENCO-I, II & III, on account of availing higher outages than the allowed limit as specified in their respective Power Purchase Agreements during FY 2016-17. However, the process is continuing for FY 2017-18.

The data pertaining to net capacity factor, as submitted by public sector GENCOs for the FY 2016-17 and 2017-18, reveals that the net capacity factor of all the Gencos remained low (less than 68%) during the said period, owing to increased duration of outages and underutilization of power plants; particularly, the Net Capacity Factor of GTPS Kotri (GENCO-I), GTPS & SPS Faisalabad (GENCO-III) and Lakhra PS (GENCO-IV) remained at 10%, 6%, 1% and 2% respectively during FY 2017-18, which raises serious question marks on the performance of these power stations.

The Net Output Factor is the ratio of net actual generation to the product of net capacity and service hours. Its value should be nearly equal to 100%.

The data pertaining to net output factor as submitted by public sector Gencos for the FY 2016-17 and 2017-18, depicts that the net output factor of TPS Guddu & Guddu 747 (GENCO-II) and TPS Muzaffargarh & Nandipur Power Plant (GENCOIII) remained low (less than 80%) during the FY 2016-17 and 2017-18. Similarly, the Net Output Factor of TPS Jamshoro & GTPS Kotri (GENCO-I) remained only 71% and 76% respectively during the FY 2017-18 and that of Lakhra Power Station (GENCO-IV) remained only at 66% during the FY 2016-17, which clearly speaks of underutilization of these power plants during the said period.

The Nepra maintains that as a result of successive legal actions taken by Nepra on nonperformance of GENCO-I, II & III during the calendar years 2012 to 2014 (resulting in imposition of Rs. 5 Million each on GENCO-I, II & III) and during the fiscal years 2015 and 2016 {resulting in imposition of Rs. 2 Million fine each on GENCO-I & II (legal proceedings against GENCO-III are currently under process)}, the performance of abovementioned Gencos has considerably been improved during the FY 2016-17 and 2017-18. However, it is still beyond the targets as approved by the Nepra in their respective tariff determinations with respect to reduction in net capacity and as specified in their respective Power Purchase Agreements signed with CPPA-G with respect to availing higher outages.

Copyright Business Recorder, 2019

Read Comments