PAEC seeks Rs8.85 per unit for 40 years

ISLAMABAD: Pakistan Atomic Energy Commission of Pakistan (PAEC) has asked for the tariff of Rs8.85 per unit for its third nuclear power plant at Chashma for 40 years. The third nuclear power plant -- Chashma Nuclear Power Plant (C-3) with capacity to generate electricity of 340MW has started commercial generation of electricity since December 6, 2016.

PAEC has come up with this demand in its petition submitted with Nepra seeking the levelized tariff of Rs8.85 per unit for 40 years.

The project's cost has been proposed at Rs145.793 billion and PAEC as petitioner has sought internal rate of return of 15 percent on its equity investment of Rs19.492 billion. The petitioner has asked the regulator to allow passing duties, taxes and levies to end consumers.

In the petition, of which copy is also available with The News, PAEC has also asked for the redemption of equity in 28 years from year 13-40. In addition, PAEC has also requested the regulator to allow passing the plant insurance on actual basis to consumers. More shockingly, the end consumers will also be forced to pay in the tariff the debt servicing of Rs 3.7 billion on foreign loans and Rs0.8392 billion on local loans, the petitioner reveals.

During the period of 1-12 years since the commissioning of the project, the tariff of the electricity to be generated from Chashma nuclear power plant-3 will be Rs10.8 per units. However, in 13-40 years the tariff will be at Rs6.244 per unit which is why the PAEC has asked for the levelised tariff of Rs8.85 per unit for four decades.

Pakistan has set the target to generate nuclear power of 8,800 MW by 2030. At the moment C1 and C2 are generating 600 MW at average cost of Rs7 per unit. In addition, the Karachi Nuclear Power Plant (KNUPP-1) is also operational and generating at the moment 70 MW. It is an old plant installed with assistance from Canada. When India exploded nuclear bomb in 1974, Canada stopped assisting on KNUPP. Since then Pakistan’s experts are running this project.

However, C3 is operational since December 2017 and C4 is in advanced stage. Both have the capacity to generate 860 MW. Likewise, KNUPP-2 and KNUPP-3 with capacity to generate nuclear electricity of 1100 MW each, will be commissioned in June 2020 and April 2021 respectively.

Pakistan will install 10 nuclear power plants by 2030 for which six sites have been selected to make possible “the mission impossible” to increase capacity to generate 8,800 MW.

According to a senior official, the PAEC has selected six sites for installation of more nuclear power plants (NPPs) that include 1) Qadirabad-Bulloki (QB) link canal near Qadirabad Headworks; 2) Dera Ghazi Khan (DG) canal near Tuansa barrage, 3) Taunsa-Punjnad (TP) canal near Multan; 4) Nara canal near Sukkur, 5) Pat Feeder canal near Guddu and 6) Kabul river near Nowshera.

These sites are in addition to the Chashma site where four nuclear plants C-1, C-2 (already operational) and C-3 C-4 are going to be installed. The other nuclear power plants would be installed at sites selected by the PAEC.