Of state-run power plants

The performance of public sector thermal plants (GENCOs) has been anything but satisfactory over the past years. Most of them operate at poor efficiencies and operate well below their rated capacities. In some cases, they sit altogether idle and the regulator has not shied away from criticizing their performance in its reports.

Recently, Nepra imposed a fine of Rs5 million on Northern Power Generation Company Limited (GENCO-III) due to negligence in maintenance. The company failed to properly maintain the 220 kV switchyard of TPS Muzaffargarh and its protection system also failed to work. This resulted in the northern power network of the country breaking down at the start of January, 2016 and engulfing most of Punjab and KP in darkness.

The state of GENCOs does not surprise anymore and the previous PML-N government made no efforts to plug the losses incurred by these outdated and mismanaged power plants. However, that it took more than two years to identify the culprit of the power breakdown and impose a fine by the regulator also speaks of the lack of accountability in the GENCOs.

Nepra puts the total energy wasted by GENCOs during 2014-16 at a mind-boggling 15 billion KWh! In its conclusion, “Performance evaluation report of public sector GENCOs FY14-16” puts the energy loss by GENCOs to three things. First is the excess consumption of auxiliary power during service mode than the allowed limit set by the regulator.

Second is auxiliary power consumption during standby mode as many GENCOs remained idle for long durations during the period observed? Lastly, the public sector generation plants also shut down more frequently utilising more than permissible outage hours under their PPAs.

With the state of GENCOs deteriorating over the years, perhaps the decision by the PML-N government to set up three state-run power plants might end up with the same fate as previous government owned power plants.

Even apart from the technical issues the R-LNG power plants have suffered from, the non-utilisation of RLNG due to operational delays of these power plants has put further strain on the exchequer as the RLNG supply chain is also government controlled.

With a weakened power regulator as a result of reforms made by the PML-N government, the lack of accountability in government run power plants will only increase in the future. This will not be last breakdown attributed to GENCOs given the state they have fallen into.