Disagreements between Power division and KE regarding supply of additional 1400MW

The issue of additional supply of 1400MW to Karachi has still not been resolved as there have been disagreements between Power Division and Karachi Electric (KE) regarding base load verses firm capacity and Late Payment Surcharge for regulatory delays between the two parties.

In this regard newly appointed Secretary Power, Syed Asif Hyder Shah has also convened an internal meeting to help the two parties come to an amicable resolution of differences.

On the issue of base load verses firm capacity, NTDC argued that K-Electric is to be treated at par with the rest of the country on pro-rata basis in line with Grid Code 2005, and if there is any shortfall of available power in NTDC system, due to any reasons whether force-majeure or otherwise, K-Electric shall have to share the same on pro-rata basis with other Distribution Companies. While KE demands that power provided to it be made available on base-load unwavering basis and power curtailment only be done during force majeure.

Another issue which is still unresolved between the Power Division and Karachi Electric is Late Payment Surcharge (LPS) for regulatory delays. KE argues that tariff determinations, monthly or quarterly tariff adjustments are to be made in a timely manner as per the statutory timelines and in case of any delays a mechanism for compensation of cost of such delays in respective tariff of K-Electric be allowed by the regulator .Power Division which has to pay the amount of tariff differential subsidy through its entity CPPA-G, strongly disagrees with this proposal.

It is expected that after a couple of internal meetings these issues will be resolved