KE’s secondary reserve: Nepra’s approval sought for BQPS-I Unit-5 retention
ISLAMABAD: K-Electric Limited (KE) has sought National Electric Power Regulatory Authority’s (Nepra’s) approval to retain Unit-5 of its Bin Qasim Power Station-I (BQPS-I) as a secondary reserve until financial year 2030, citing growing electricity demand, geopolitical uncertainties and concerns over fuel supply security.
The regulator has issued a public notice inviting comments from stakeholders, interested and affected persons and the general public on the proposed modification in KE’s generation licence under Regulation 10 of the Nepra Licensing (Application, Modification, Extension and Cancellation) Procedure Regulations, 2021.
According to Nepra, KE, in its application, argued that electricity demand in its service area is expected to continue growing steadily over the forecast period. However, the prevailing geopolitical environment, coupled with the force majeure declared on Pakistan’s two RLNG terminals, has heightened concerns regarding fuel supply security.
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According to KE, resulting fuel price volatility and supply-chain disruptions underscore the importance of maintaining fuel flexibility and strengthening energy security within its generation portfolio.
The company particularly emphasised the strategic importance of BQPS-I Unit 5 because of its dual-fuel capability, enabling it to operate on both natural gas and furnace oil. KE maintains that retaining the unit would provide operational flexibility and help ensure reliable electricity supply to consumers in its service area.
The proposed modification, however, carries financial implications for consumers. KE has requested Nepra to allow annual operation and maintenance (O&M) costs of Rs152 million, including applicable indexations, to be passed through in the electricity tariff.
In addition, the company has sought approval for working capital requirements of Rs73 million, also subject to relevant indexations.
KE has justified the additional costs by arguing that retaining the unit would enhance energy reliability, improve operational flexibility and reduce dependence on expensive high-speed diesel (HSD)-based generation.
The company further contended that the proposed modification would increase the available capacity of its generation fleet and improve the quality of service without adversely affecting its obligations under the generation licence.
Nepra invited stakeholders to submit comments either in favour of or against the proposed licence modification to the Office of the Registrar within 14 days from the date of publication of the notice.
The regulator has also clarified that submission or communication of the proposed modification, and its acceptance for consideration by Nepra, should not be construed as approval by the authority.
The proposed retention of BQPS-I Unit 5 will now be examined by the regulator in light of stakeholder comments and its potential implications for electricity consumers, generation reliability and the overall cost of power supply.
The request for extension in useful life of Units of BQPS I will ultimately increase the available capacity of KE’s generation fleet as well as improve the quality of service through better planning to meet any contingency requirements, including but not limited to any unavailability of NGC interconnection, any forced outages of generation fleet and IPPs, and RLNG/Gas shortfall due to reasons beyond control of KE, thus improving the performance of KE as per its obligations under the License.
Moreover, there will be no adverse impact on the quality of service provided by KE if the requested extension in life of Unit 5 of BQPS I is allowed/approved. The Company certifies that it has been fully diligent and dedicated to the performance of its services and aspires to ensure uninterrupted and reliable supply of power to its consumers.
Copyright Business Recorder, 2026