The Sindh energy department is planning a 500-megawatt (MW) floating solar PV project at the Keenjhar Lake to supply power to the K-Electric (KE) under the public-private partnership mode.
However, the plan currently seems to be in limbo due to uncertainties surrounding the tariff finalisation as well as deciding on the agency that will supply the power generated from the project to the KE’s grid. There has been no clarity on whether the power will be transported by the National Transmission and Dispatch Company Limited (NTDC), which is a federal entity, or the Sindh Transmission and Dispatch Company Limited (STDC), which is its provincial counterpart.
To provide the context, the NTDC is a federally-owned company that links power generation units with power distribution agencies across the country. However, following the 18th Amendment, Sindh established its own power transmission company STDC in January 2015, which currently operates a 132KV double-circuit transmission line stretching 95.74 kilometres to transmit 100MW power from the Sindh Nooriabad Power Company (Pvt) Ltd to the KE KDA-33 Grid Station in Karachi.
The STDC could potentially build a similar transmission network to supply power from the proposed floating solar project at the Keenjhar Lake to Dhabeji, where the KE’s service territory begins. However, its chief executive officer, Muhammad Saleem Shaikh, has denied any such proposal at this time.
The planning on the floating solar project started after GO Energy (Pvt) Limited’s Chief Operating Officer Ammar Ali submitted a proposal on February 15, 2022 to the Sindh government for developing a 500MW floating solar power plant on the Keenjhar Lake in Thatta district.
According to the project’s Environmental and Social Impact Assessment (ESIA) report submitted to the Sindh Environmental Protection Agency (Sepa) on January 26, 2024, the GO Energy is the project’s sponsor, KE the power purchaser, Sindh energy department the execution agency, and Sindh irrigation department the custodian of the Keenjhar Lake.
Deadlines missed
According to the annexure attached to the ESIA report, the energy department issued a Letter of Intent (LOI) to the GO Energy on June 14, 2022, which was to expire 18 months later on December 14, 2023.
Under the terms of the LOI, the private energy company was required to complete the feasibility study at least 120 days before the expiry date. Additionally, the company needed to secure a water use agreement from the provincial irrigation department, a non-objection certificate from the provincial fisheries department and ESIA approval from Sepa prior to completing the feasibility study. The company was also expected to obtain the ‘award of tariff and generation licence’ from the National Electric Power Regulatory Authority (Nepra) within the LOI’s validity period.
Director of Alternative Energy, Sindh, Mehfooz A Qazi informed The Citizenry that the United Nations Development Programme (UNDP) was currently assisting the GO Energy with the feasibility study, which is still under way although around nine months have passed since the LOI’s expiry.
He added that Sepa has not yet approved the ESIA. However, he stated that the UNDP is impressed with the project and plans to feature it in its international fair in 2025.
No clear explanation has been given regarding why the deadlines were missed or whether an extension was granted to the private company. The Clause 6 of the LOI included in the ESIA report submitted to Sepa in January states that the provincial energy department may grant an additional six months for securing Nepra’s tariff award, thereby extending the LOI’s validity.
The ESIA report available on the Sepa website does not include a certificate confirming the six-month extension, but even if that extension was granted, the extension period ended in June this year.
Who will award tariff?
Dr Khalid Waleed from the Sustainable Development Policy Institute explained that if the KE is the buyer of the power generated from the project, the tariff will be determined by Nepra as it regulates the KE’s tariffs. Additionally, the LOI signed between the KE and GO Green on July 7, 2022, also specifies that the latter will have to obtain both distribution licence and tariff approval from Nepra.
He, however, added that if the provincial government sells power from the project to different villages or communities through the STDC, the tariff will not necessarily have to be set by Nepra. Instead, it could be determined by Sindh’s own regulatory body, the Sindh Electric Power Regulatory Authority (Sepra), which is the first autonomous power regulatory authority established by a province in Pakistan.
Dr Waleed believes that the establishment of Sepra is a significant step towards provincial autonomy in the renewable energy sector.
Project sans competitive bidding
There was also no competitive bidding for the project as it falls under the Mode 3 of the federal government’s Alternative and Renewable Energy (ARE) Policy, 2019.
Qazi explained that renewable energy projects on raw sites, such as Keenjhar Lake, which have never been explored before, fall under “unsolicited sites”, for which the bidding process is not mandatory.
According to the ARE Policy 2019, any project involving new technology for generating electricity can be presented directly to the Alternative Energy Development Board (AEDB). An official of Nepra told The Citizenry that the AEDB has now been merged into the Private Power and Infrastructure Board (PPIB) under the federal energy ministry’s power division.
The policy document reads that the new power technology projects are not part of any government request or tender but are proposed directly by companies or provinces to the AEDB for approval. They focus on new renewable energy technologies, such as solar or wind, to generate electricity.
The tariff, which is the price at which electricity from these projects will be sold, must be lower than the country’s average cost of electricity production. Such projects can only be implemented only if the AEDB approves them.
Qazi said the provincial energy departments now have their own AEDBs, which directly approve unsolicited projects without the involvement of the federation. After the 18th Amendment, the provinces can carry out unsolicited projects through their own AEDB, said Waleed.
The GO Energy also signed a memorandum of understanding (MoU) on June 13, 2024, with the STDC for the transmission of power from the proposed 500-megawatt floating solar project on the Keenjhar Lake. However, when The Citizenry asked the STDC chief about it, he categorically denied any implementation of such MoU stating that currently, no transmission network plans were even under discussion.
This explanation of the STDC chief, however, does not align with Sindh Energy Minister Syed Nasir Hussain Shah’s statement that he had made at the MoU signing ceremony. The minister had stated that the STDC would lay a 220KV transmission line, which would be approximately 60 kilometres long, to connect the floating solar project to the KE’s grid station at Dhabeji, Karachi. He had also mentioned that the KE was the off-taker for the 500MW floating power project, for which it had issued an LOI, whereas the energy department had also provided an LOI to the GO Energy.
Upon perusal of the KE’s LOI, The Citizenry found two major gaps. Firstly, the KE’s LOI states that the final off-take capacity and the project’s lifespan will be determined mutually, based on feasibility studies, which are yet to be concluded.
Secondly, the LOI specifies that since the project is outside the KE’s service territory, the responsibility for arranging transmission—whether through wheeling via an existing transmission line or by establishing a dedicated transmission line to the interconnection point—lies with the GO Energy.
Until there is complete clarity on these points, the project’s implementation seems to remain uncertain.
Sindh Energy Department Secretary Musaddiq Ahmed and the GO Energy chief operating officer did not respond despite repeated messages and phone calls by The Citizenry to get their version.
Subedited by Bilal Ahmed
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