ISLAMABAD: The government confirmed on Sun­day successful commercial operations of a $2 billion 1,320MW coal-fired power plant set up by the China Power Hub Generation Company (CPHGC) under the China-Pakistan Econo­mic Corridor (CPEC) project.

“M/s CPHGC has successfully undergone through commissioning tests as per the agreed procedure. The engineer has certified the successful commissioning of the complex,” said a notification issued by the Central Power Purchasing Agency (CPPA) — a government-owned subsidiary responsible for procuring power from plants and selling them to distribution companies.

The CPPA said the power producer had called for declaring its commercial operation date (COD) from Aug 17, 2019, while its engineer — SGS — had also issued certificate of initial tested capacity that came out at 1,249MW. Therefore, it called upon the National Power Control Centre (NPCC) to issue dispatch instructions to the CPHGC keeping in view the system requirements.

Separately, the CPHGC announced that it had successfully declared the COD of its 1,320MW (2x660) imported coal power plant and integrated jetty with coal transhipment capacity of 4.2 million tonnes per annum.

The CPHGC is a joint venture between the Hub Power Company (Hubco) and China Power International Holding (CPIH) and a part of early harvest energy projects under the CPEC framework agreement.

The government had approved the processing of 1,320MW imported coal-based power project at Hub in November 2014 and the joint venture of Hubco and CPIH was issued letter of intent in June 2015. The National Electric Power Regulatory Authority (Nepra) had approved the upfront tariff for the power project in February 2016. The Joint Cooperation Committee (JCC) of the CPEC included a 660MW unit of the project in the list of ‘priority projects’ and the remaining 660MW in ‘actively promoted projects’ under CPEC framework agreement of Nov 8, 2014.

As the questions about ‘capacity trap’ started arising, the government had decided in 2016 to give up one of the two 660MW plants to contain reliance on imported fuels and reduce foreign exchange losses. However, it was compelled to restore the full capacity after the Chinese partner of the joint venture took up the matter at the highest level and then followed it up at the 6th JCC meeting in December 2016.

The Pakistan government was told that commercial viability of the Hub power project on supercritical technology was possible only with 1,320MW for which it had also been given tariff by Nepra at the request of Islamabad. It also took the stance that negotiations and processing of the project starting in November 2014 pertained to 1,320MW for which financial arrangements had also been ensured and its unilateral reduction to 660MW at an advanced stage was unacceptable.

On Sunday, the company said it had developed the plant in a record time, as per schedule and within the projected cost, and would add nine billion units (kWh) of electricity to the national grid every year, meeting the electricity needs of four million households in the country.

The project’s two units achieved synchronisation with the national grid on Dec 28, 2018 and May 28, 2019, respectively, while the Integrated Coal Jetty became operational in December last year with the arrival of the first shipment of coal.

“The successful completion of CPHGC project has fortified the dream of energy independence of Pakistan,” said Khalid Mansoor, the chief executive officer of Hubco, adding that “Pak-China synergy has resulted in engineering excellence and has fulfilled our promise of providing Pakistan with affordable and ample energy”.

He said the project had on Aug 14 completed a reliability run test involving a weeklong uninterrupted power supply at different loads that formally completed the commercial operation date certified by independent engineers as required under the power purchase agreement. This was followed by net electrical output confirmation by engineers in the presence of representatives of the National Transmission & Despatch Company.

The company said the project had also delivered on various social commitments for improving the lives of the local community of Hub and Lasbella. Together with its partners, the CPHGC has set up a school in Gadani, a floating jetty for fishermen in Abbas village and conducted various training and development programmes for the youth of Balochistan.

The Pakistani principal of the project — Hubco — currently produces over 2,920MW through its four plants spread over Balochistan, Punjab and Azad Kashmir. Hubco is the only power producer in Pakistan with four projects listed in the CPEC, out of which three are under construction — Thar Energy Limited, Thalnova Power Thar (Pvt) Ltd and Sindh Engro Coal Mining Company — at Thar Block II. The power generation capacity of the company has increased to over 3,580MW after the completion of the latest project.

Published in Dawn, August 19th, 2019