ECC approves utilization of CPPs' capacity sans payment

The Economic Coordination Committee (ECC) of the Cabinet has approved short-term utilization of available capacity of Captive Power Plants (CPPs) without any capacity payment, official sources told Business Recorder.
According to the policy, capacity of 3 MW or above based on gas, furnace oil, coal, baggase or any other fuel will be offered for purchase under the new policy.
Ministry of Water and Power, sources said, informed the ECC that in view of growing power demand in the country, the government had adopted a coherent approach for energy security.
The Energy Security Plan was aimed at not only adding new power generation sources but also diversifying and tapping all possible fuel sources for power generation. Since the new projects would be coming online in a sequential manner after meeting their committed Commercial Operational Date (CoD) timelines, the Ministry of Water and Power proposed immediate utilization of plants available but not generating energy under various modes including captive power plants. These plants were installed in various large industrial units based on various fuels.
Ministry of Water and Power further revealed that GoP was intending to bring forth a transparent policy for utilization of power generation of these plants in the national grid, as a short term measure, in order to optimise use of available generation in during summers of 2017 and 2018. This arrangement can add to the tune of 300-600 MW of generation in the national grid. Following salient features of this policy were highlighted: (i) plants having capacity of 05 MW or above on gas, furnace oil and coal as fuel will be offered energy purchase under this policy;(ii) policy directive to Nepra for announcing tariff for buying power from the available capacities in coal, gas and furnace oil for which PPA template will be approved by Nepra to be adopted by all Discos and CPP-G;(iii) policy directive to Nepra for granting generation license to the indicated companies on fast track basis; (iv) tariff shall be based on take and pay basis and electricity actually delivered to the national grid; and (v) term of the PPA will be for summers of year 2017 and 2018.
The ECC also decided that policy directive to Nepra for announcing respective tariffs for buying power from the available capacities based on different fuels for which PPA template will be approved by Nepra to be adopted by all Distribution Companies (Discos) and CPP-G.