Nepra developing upfront tariff for biomass-based power projects

MUSHTAQ GHUMMAN

ISLAMABAD: National Electric Power Regulatory Authority (Nepra) through its suo motu powers has decided to develop upfront tariff for biomass-based power projects.

For this purpose, the regulator has prepared a proposal for the stakeholders, according to which tariff for 1-10 years has been proposed at Rs7.2781 per unit, 11-30 years Rs5.7477 per unit, levelized tariff, Rs6.9819 per unit whereas the proposed tariff for 16-60 years is Rs6.7435 per unit and levelized tariff at Rs6.6758 per unit.

The generation tariff assumptions are as follows: (i) project cost has been assumed as US$ 0.8 million per MW; (ii) annual plant factor has been assumed as 80%; (iii) insurance has been assumed as 1% of EPC cost; (iv) the debt equity structure of 75:25; (v) IRR of 15%; (vi) Kibor of 6.53%; (vii) spread over Kibor as 3%; (viii) exchange rate parity of Rs 105/$; (ix) debt repayment period of 10 years, 15 years and WACC (11.33%) for 30 years; (x) efficiency of 29.24% (flat) Calorific Value of 12364.74 average of all biomass agricultural residue; and (xi) fuel price of Rs 5,000/ton, including freight. The power projects can use agricultural residue, i.e., cotton stalk, wheat stalk, rice straw, rice husk, maize straw, maize husk, maize cob, wood, etc, for electricity generation.

According to Nepra, the proposed costs and assumptions may vary (upward/downward) based on the information/data received from the stakeholders during the proceedings.

Nepra has also asked interested persons who desire to participate in the proceedings to file an intervention request within 15 days from the date of publication of this notice. Such intervention request should state the name and address of the person filing the same, objections and the manner in which such person is likely to be substantially and specifically affected by any determination in the proceedings. The intervention request may also contain the contentions of the person making the same, the relief sought and the evidence, if any, in support of the case.