ISLAMABAD, June 28: The government on Thursday told the sugar industry that power co-generation by sugar mills will be encouraged provided the tariff was cheaper and electricity was available faster than thermal plants.

This was the outcome of a meeting presided over by Minister for Industries, Production and Special Initiatives Jahangir Khan Tareen. The meeting was also attended by the representatives of Planning Commission, National Electric Power Regulatory Authority, Wapda, Private Power Infrastructure Board, National Transmission and Dispatch Company and Pakistan Sugar Mills Association (PSMA).

The minister told the industry that before reaching on any decision, it will also be ensured that sizeable quantity of sugar was available and that the mills use non-gas fuels for power co-generation.

The PSMA in its presentation told the meeting that mills would use

baggase and coal as fuel. They also informed that the electricity produced by them would be cheaper than the thermal power. The PSMA had the capacity to produce up to 1500MW of electricity and that they can start production by the year 2009-10.

The meeting was informed that a sugar mill of an average size could produce 30-40MW of electricity. Counting advantages of power co-generation by the sugar mills, PSMA told the meeting that they could ensure speedy production of electricity than that of thermal power plants and that they will use baggase as a fuel, which is renewable.

The meeting decided that a presentation should be given to the prime minister on the whole scheme of power co-generation and the issues like tariff will be brought to his notice before the sugar industry is formally given a go ahead.