ISLAMABAD: The Council of Common Interests almost tripled on Wednesday the water use charges payable to the provinces by producers for hydropower generation.

“Water Use Charge (WUC), to be paid by hydro IPPs to the respective province where project is located, has been enhanced from Rs0.15 per kwh to Rs0.425 per kwh,” said a summary on Power Generation Policy, 2015, approved in principle by the CCI.

The council decided that a committee comprising representatives of federal and provincial governments and AJK and Gilgit-Baltistan should be constituted to review the charges every five years to determine if further increase was required.

The provinces would be required to spend an unspecified amount of the charges for improving living conditions of communities where the project is to be situated. The policy protected negotiated mega power park companies for alternative fuels like Punjab’s 1,000MW Solar Power Park with a Chinese firm, Zonergy.

Likewise, the exploration and development companies of dedicated gasfields have been given the first right of refusal to set their own power plants.

Sindh and Khyber Pakhtunkhwa had some reservations over the main power generation policy.

The policy appeared to be an attempt to address concerns of investors regarding payment issues on account of electricity sales to the national grid. Stakeholders agreed in principle to allow the provinces to have their own power distribution system and regulatory authorities to govern the power sector without having financial implications on the federal government and without affecting other provinces.

Water and Power Secretary Younas Dagha told Dawn that an attempt had been made to bring clarity to the power generation policy with a futuristic outlook following changes emerging after the 2002 policy and the subsequent 18th Amendment.

For example, the provinces would in future be empowered to have their own power dispersal system based on their own power projects without any financial implications for the federal government.

Mr Dagha agreed it was not an immediate possibility but would provide clarity to the provinces, AJK and GB also to set up their own power regulatory bodies on the pattern of National Electric Power Regulatory Authority.

Published in Dawn, March 19th, 2015

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