The prevalent power crisis has forced the government to resort to revival of its abandoned plan of power co-generation by sugar mills, as the sugar industry has expressed its readiness to provide around 1000 mw in 2008-09.
The sugar industry will need to invest $1.5 million for generating one megawatt electricity, Iskandar Khan, vice chairman of PSMA, told Business Recorder after PSMA delegation held a meeting with Minister of Industries Jehangir Khan Tareen here on Monday.
Iskandar said that Pakistan Sugar Mills Association (PSMA) would support the government in its endeavours to bridge the present power demand-supply gap.
"We will hold another meeting next week, and the PSMA will give a detailed presentation on power co-generation by the sugar industry, which has the power generation capacity of 1500 mw to 2000 mw. Most likely, the next meeting would be held on June 25."
The PSMA would not be able to provide electricity to the national grid before 2008-09 as the sugar mills would require to make fresh investments, he said. The PSMA is of the view that power demand would increase in the coming years and the government would be under pressure if it totally remained dependent on independent power producers (IPPs), he said.
The power co-generation was approved by the Economic Co-ordination Committee (ECC) of the Cabinet some time more than one year back. However, the plan could not be implemented as various stakeholders were not coming to terms with sugar mills. The implementation could not be made possible despite the government had handed over the issue to the Private Power Infrastructure Board (PPIB), sources said.
Jahangir informed the meeting that the government was making every possible effort to fill the energy gap caused by rapid industrialisation over the last few years.
The meeting was also attended by Shahab Khawaja, Secretary Industries, representatives of PSMA, and senior officials of the Planning Commission.
According to an official statement, the meeting was called to discuss the feasibility of power co-generation by the sugar mills.
The minister said that government was focusing on power co-generation by sugar mills as a short gestation period energy source to meet the increasing energy demand in the country.
The PSMA, in its presentation, briefed the meeting about the feasibility and financial viability of the power co-generation by the sugar mills. The PSMA also said that sugar mills could produce 2000 mw electricity in the next 5 years.
Other important issues like tariff came under discussion during the meeting. It was decided that a series of meetings would be held involving all stakeholders to evolve consensus regarding power co-generation by the sugar industry.