ISLAMABAD, Aug 24 The government has awarded a $603 million contract to a Chinese firm for upgrading 13 generation units of Guddu power plant.

Sources told Dawn on Monday that after the upgradation, the capacity of Guddu power units would increase from 250 MW to 750 MW.

Water and Power Secretary Shahid Rafi said the Harbin Power Engineering of China had agreed to start work on the project without financial close, only on receipt of advance payment.

About 85 per cent financing for the project would be arranged by a consortium of Export-Import Bank of China and a US-based financial institution, while the Pakistan Electric Power Company would come up with the remaining 15 per cent.

A summary of the project, to be completed by the end of 2010, says that its cost is highly competitive compared with projects developed over the past four years.

Guddu's combined cycle units will have an efficiency of 54.5 per cent. The expected tariff of Rs3.6 per unit or 4.44 cents per kilowatt hour is the lowest for any thermal plant in the country.

According to an official document, modern technology to be used in the upgradation will enable the steam turbines to convert waste heat into energy.