ISLAMABAD, July 31: The National Electric Power Regulatory Authority (Nepra) has rejected the federal government’s move to hold public discussions on tariff it approved two weeks ago for two private sector power projects.

Reliable sources told Dawn on Sunday that a secretaries committee comprising federal secretaries of water and power, finance, cabinet division and managing director Private Power and Infrastructure Board had invited the Nepra chairman and other members to discuss tariff determinations for Star Power Limited (SPL) and Orient Power Company Limited (OPCL).

The committee had convened the meeting on Saturday as OPCL was not satisfied with the tariff approved by the Nepra and wanted to increase the tariff further.

The sources said that Chairman Nepra Lt Gen Saeed-uz-Zafar refused in writing to attend the meeting or revise the tariff as desired by the company.

It asked the secretary, water and power, to file a review petition under the law it wanted to provide more concessions to the private company and the Nepra would examine the review petition as per provisions of law.

“Everybody wants us to close our eyes and provide as much concession to the investor as it desired without safeguarding the interests of consumers or the country. We can not do this,” a senior Nepra official told Dawn.

The official said that Nepra had already given benefit of the doubt to two companies in tariff setting which it may not be able to explain or protect in a court of law.

He said SPL was satisfied with the tariff but OPCL was using all kinds of pressure tactics to further enhance the tariff. “If the government files a review petition, the tariff for Orient Power will have to be reduced because it had higher generation capacity and should have received less benefit of doubt compared to Star Power on the basis of principle of economy of scales.”

The Nepra on July 17 had made an upward revision in the tariff for the 225mw OPCL and the 130mw SPL to 4.55 cents per unit and 4.65 cents per unit respectively.

The Nepra had earlier fixed the tariff for the two companies in the range of 4.04-4.16 cents per unit but the two companies had threatened to pull out their investment as they claimed the tariff was not enough to ensure them a reasonable rate of return.

However, the prime minister’s secretariat had prevailed upon both the investors to file review petitions.

The revised tariff calculated by Nepra was close to the demand made by both the independent power producers.

The OPCL is owned on a 50/50 per cent basis by Globleq of the UK and a local entrepreneur, Nadeem Babar. The project will be located at Balloki, near Lahore, and will be based on dual fuel. The OPCL will add another 200-225mw by 2010 on availability of new gas supplies or imported gas.

Star Power, owned by the Al-Ghurair group of the UAE, will also be a dual-fired project and will be based on gas supplies from the Mari-Deep gas field.

The Al-Ghurair group had originally demanded about 4.79 cents per unit of tariff but the Nepra allowed it only 4.16 cents per unit. On a review petition, its tariff has now been increased to 4.65 cents per unit.

The managing director, PPIB, Zafar Ali Khan, had stated that the revised determination was close to the demand made by the Independent Power Producers and would be a trendsetter for future investment in the power sector.