ISLAMABAD: Anticipating the success of nuclear negotiations between Tehran and Washington, the National Electric Power Regulatory Authority allowed on Tuesday signing of a formal agreement for the import of 1,000MW of electricity from Iran at Rs8-11 per unit.

The state-owned National Transmission and Dispatch Company had sought permission to negotiate the agreement. The NTDC had signed a memorandum of understanding with its Iranian counterpart TAVANIR for electricity trade on May 31, 2012.

Know more: Iran offers electricity at low tariff

The two companies had approved a feasibility study jointly prepared by Nespak (National Engineering Services of Pakistan) and MOSHANIR of Iran for electricity supply via Balochistan.

A public hearing, presided over by Nepra Chairman Tariq Sadozai, was informed that the cost of high-voltage direct current (HVDC) interconnection project, including two converters-cum-inverters substations along with 500KV transmission line, had been estimated at $700 million, excluding the cost of 1,300MW power plant needed to be constructed on the Iranian side.

Iran will construct the power plant from its own resources while TAVANIR had offered to finance $265m HVDC interconnection project in its own territory.

Nepra’s member tariff Khwaja Mohammad Naeem informed the hearing that his organisation did not raise any objections over the proposed tariff because the NTDC had finalised very fine terms and conditions of the deal.

The tariff had been based on a floor of $65 per barrel crude oil prices and a ceiling of $110 per barrel. As a result, the minimum delivered power tariff would work out at Rs8 per unit and a maximum of Rs11 per unit.

Pakistan has been importing about 74MW from Iran for Balochistan at the same tariff since 2007.

Responding to a question, the NTDC representatives said the difficulties arising out of international sanctions against Iran had blocked payments by the NTDC which have accumulated to $311m till December last year.

It was reported that the two sides had been in talks for barter trade to adjust electricity payments to Iran but ways and means of payments were still being looked into. The due payments were being kept in a separate account for ultimate payment to Iran.

According to the NTDC, electricity would be imported through 500kv double circuit transmission line capable of containing system losses below two per cent and tripping of one line would automatically shift power load to the other line, resulting in uninterrupted supply.

The cost of transmission line from Iranian border to Quetta had been estimated at $580m.

The agreement would be for 30 years.

NTDC chief Mohammad Shabbir said Iran had generation capacity of about 70,000MW and it was adding about 5,000MW every year.

Iran also exports electricity to Turkey, Iraq, Afghanistan, Azerbaijan and Turkmenistan.

Mr Shabbir said Iran had offered to supply 3,000MW to Pakistan. He expressed the hope that resolution of Iran’s nuclear issues with western powers would also resolve the question of Pakistan’s payments.

He said upgradation of grid stations at Mand by the end of this year would jack up electricity import for Balochistan from 74MW to 104MW by January next year.

Published in Dawn March 11th , 2015

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