National Electric Power Regulatory Authority Islamic Republic of Pakistan
NEPRA Tower, Attaturk Avenue (East), G-5/1, Islamabad Ph: +92-51-9206500, Fax: +92-51-2600026
Web: www.nepra.org.pk, E-mail: [email protected] Registrar
No. NEPRA/R/DL/LAG-353/ --IVS 911
Mr. Liu Yongjun Chief Executive Officer,
Datang Pakistan Karachi Power Generation (Private) Limited (DPKPG), RIAA Barker Gillette Chambers, D-67/1, Block 4, Clifton, Karachi
May 23, 2017
Subject: Grant of Generation Licence No. IGSPL/79/2017 Licence Application No. LAG-353
Datang Pakistan Karachi Power Generation (Private) Limited (DPKPG)
Reference: DPKPG's application vide letter dated June 13, 2016 (received on 14-06-2016).
Enclosed please find herewith Determination of the Authority in the matter of Application of
"Datang Pakistan Karachi Power Generation (Private) Limited (DPKPG)" for the Grant of
Generation Licence along with Generation Licence No. IGSPL/79/2017 annexed to this
determination granted by the National Electric Power Regulatory Authority (NEPRA) to Datang
Pakistan Karachi Power Generation (Private) Limited (DPKPG) for its 700.0 MW Imported Coal
based Generation Facility at Plot No. EIZ/LUSP-09, Port Qasim Area, Bin Qasim Town, Karachi, in
the Province of Sindh, pursuant to Section 15 of the Regulation of Generation, Transmission and
Distribution of Electric Power Act (XL of 1997).
2. Please quote above mentioned Generation Licence No. for future correspondence.
Enclosure: Generation Licence No. IGSPL/79/2017.
REGISTRAR et
Zo
I . Chief Executive Officer, K Electric (KEL), KE Ho Phase-II, Karachi
2. Chief Executive Officer, CPPA-G, ENERCON Building, Sector G
3. Chief Executive Officer, NTDC, 414-WAPDA House, Lahore
4. Director General, Environment Protection Department, Government of Sindh, Complex Plot No. ST-2/l, Korangi Industrial Area, Karachi.
5. Chairman, Port Qasim Authority, Bin Qasim, Karachi-75020 Pakistan. 6.
Managing Director, Private Power and Infrastructure Board (PPIB), Ground Floors, Tower, Plot No. 10, Mauve Area, Sector G-8/1, Islamabad-Pakistan
tIER
Copy to: (Syed Safeer Hussain)
Main Sunset Boulevard, DHA,
-5/2, Islamabad.
Emigration
National Electric Power Regulatory Authority (NEPRA)
Determination of the Authority in the Matter of Application of Datanq Pakistan Karachi Power
Generation (Private) Limited for the Grant of Generation Licence
May 17, 2017 Case No. LAG-353
(A). Background
(i). K-Electric Limited (KEL) is providing the electric power services in
the metropolitan city of Karachi and its adjoining areas. In this regard, the
Authority had granted three (03) separate licences to KEL for Generation,
Transmission and Distribution services. In order to meet with its requirements,
KEL has its own existing generation fleet with an installed capacity of about 1875.00 MW.
(ii). The demand of the city of Karachi and its suburbs is rising
exponentially. In view of the said, the abovementioned installed capacity is not
sufficient to meet with the future load requirements. Therefore, KEL has planned
addition of more generation capacity in its system through a joint venture with
Chinese investors for setting up a new 700.00 MW imported coal based generation facility.
(B). Filing of Application
(i). In accordance with Section-15 of Regulation of Generation,
Transmission and Distribution of Electric Power Act, 1997 ("the NEPRA Act"),
Datang Pakistan Karachi Power Generation (Pvt.) Limited (DTGPKPGPL)
submitted an application on June 14, 2016 requesting for the grant of generation licence.
Page 2 of 15
(ii). The Registrar examined the submitted application to confirm its
compliance with the NEPRA Licensing (Application and Modification Procedure)
Regulations, 1999 ("the Licensing Regulations") and observed that the application
lacked some of the required information/documentation. Accordingly,
DTGPKPGPL was directed for submitting the missing information/documentation
which was submitted on June 21, 2016. The Authority considered the matter in its
Regulatory Meeting (RM-16-482), held on August 18, 2016 and found the form
and content of the application in substantial compliance with Regulation-3 of the
Licensing Regulations. Accordingly, the Authority admitted the application for
consideration of the grant of the generation licence as stipulated in Regulation-7
of the Licensing Regulations. Further, the Authority approved the advertisement
containing the prospectus and a notice to the general public about the admission
of the application of DTGPKPGPL, inviting to submit their comments in the matter
as stipulated in Regulation-8 of the Licensing Regulations. The Authority also
approved the list of the relevant stakeholders for providing their comments or
otherwise to assist the Authority in the matter. Accordingly, the advertisement was
published in one Urdu and one English National Newspaper on August 23, 2016 respectively.
(iii). Apart from the above, separate letters were also sent to
Government Ministries, their attached departments, representative organizations
and individual experts etc. on August 23, 2016. The said stakeholders were
directed for submitting their views/comments for the assistance of the Authority.
(C). Comments of Stakeholders
(i). In reply to the above, the Authority received comments from seven
(07) stakeholders. These included Ministry of Petroleum & Natural Resources
(MoP&NR), Board of Investment (Bol), Engineering Development Board (EDB),
Ministry of Ports & Shipping (MoP&S), Port Qasim Authority (PQA), Private Power
Infrastructure Board (PPIB) and Ministry of Water and Power (MoW&P). The
salient points of the comments offered by the said stakeholders are summarized in the following paragraphs: -
(a). MoP&NR submitted that DTGPKPGPL is setting up an
imported coal based generation facility/thermal power
plant at Port Qasim, Karachi. In view of the current
demand-supply gap, the Authority may consider the
grant of generation licence to the company. In this
regard, it is pertinent to mention that huge quantity of
indigenous coal is available in the country and its
mining is expected to start soon. In view of the said,
the company should keep the option to utilize the
same once it is available either in total or through
blending with imported coal;
(b). Bol commented that affordable and smooth supply of
energy is the backbone for industrial growth as well as
attracting FDI in the country. In view of the said, the
proposal of DTGPKPGPL for setting up a 700.00 MW
imported coal based generation facility/thermal power
plant is supported subject to a consumer friendly and
competitive tariff and completion of all codal and
technical formalities in the matter;
(c). EDB stated that presently power plants of capacity of
25.00 MW and above are exempted from payment of
duties and taxes as defined under the relevant
notifications, and no condition for the local
manufacturing is applicable on the import of these
power plants. EDB is of the view that efforts should be
made to utilize the indigenous resources in this regard;
(d). PQA confirmed the allocation 216 acres of land by
way of transfer in Eastern Industrial Zone in favor of
KEL for establishment of 700.00 MW coal fired power
plant. It was stated that KEL intends to build trestle
and jetty to handle imported coal for self-use and the
same is under examination. PQA supported the grant
of generation licence to DTGPKPGPL to meet with the
shortage of energy in the country;
(e). MoP&S in its comments did not raise any serious
concerns pertaining to the grant of generation licence
but endorsed the comments of PQA as explained above;
(f). PPIB remarked that its Board in its 105th meeting, held
on May 03, 2016 had decided that no power projects
based on imported fuel would be entertained and
processed by PPIB in future. Further, PPIB stated that
in view of the fact that electric power from the project
of DTGPKPGPL would be supplied to KEL, it is
considered appropriate that the Authority may seek
comments of MoW&P in the matter; and
(9). MoW&P in its comments stated that being an imported
fuel project, the ban imposed by the board of PPIB
would also be applicable in this case.
(ii). The Authority considered the above comments of the stakeholders
and in view of the observations of MoP&NR, EDB, PPIB and MoW&P decided to
seek perspective of DTGPKPGPL. On the comments of MoP&NR, it was
submitted that the company has duly considered the use of indigenous coal by
blending it with higher grade imported coal for the project. Regarding the
observations of EDB, it was reiterated that the company shall try its best to utilize
the local facilities available for the project.
Page 4 of 15
(iii). On the specific comments of PPIB and MoW&P, the company
through KEL submitted that demand of the city of Karachi and adjoining areas is
growing at a rate of around five percent (5%) per annum and peak demand is
expected to reach nearly 4000 MW by 2020 from the current peak demand level
of 3195 MW. In the post privatization era, KEL is required to work independently
and does not enjoy the concessions and benefits under any power policy of the
Government of Pakistan. In view of the said facts, KEL is pursuing an aggressive
plan to add 2500 MW by 2020 through different means. In this regard, KEL has
partnered with Chinese investors for development of a 700.00 MW imported coal
based project. The project has been envisaged on imported coal as there is no
firm commitment for the availability of the indigenous fossil fuels including natural
gas and local coal. In light of the said, the company requested the Authority to
review the applicability of the decision to ban projects based on imported fuels
being set up for supplying to the city of Karachi and the adjoining areas as the
same are not being processed by PPIB, but independently through a Letter of
Intent (Lol) of KEL. Further, it was submitted that KEL is pursuing its own
business plan and such restrictions should not be made binding and applicable on
such projects. KEL should have the same opportunity to move ahead with its main
projects based on imported fuel that is available with projects processed by PPIB
for sale of power to the National Grid. In this regard, KEL requested that the
restriction on setting up power projects based on imported fuel should not be
applicable to projects supplying power to it.
(iv). The Authority considered the above submissions of DTGPKPGPL
and found the same plausible. Accordingly, the Authority considered it appropriate
to process the application of DTGPKPGPL for the consideration of generation
licence as stipulated in the Licensing Regulations and NEPRA Licensing
(Generation) Rules 2000 ("the Generation Rules").
(D). Findinqs/Evaluation
(I). The Authority has examined the case in detail including the
information provided by DTGPKPGPL with its application, feasibility study of the
Page 5 of 15
project, the grid interconnection study, the received comments of the
stakeholders, filed rejoinders and relevant provisions of applicable rules and
regulations. In this regard, the Authority has observed that the main sponsors of
the project include China Datang Overseas Investment Company Limited
(CDOIC), China Machinery Engineering Corporation (CMEC) and KEL itself.
(ii). The Authority noted that in order to implement the project, the
sponsors in terms of the requirement of the Section-24 of the NEPRA Act,
incorporated a company under Section-32 of the Companies Ordinance 1984
XLVII of 1984 having Corporate Universal Identification No. 0099889, dated May
26, 2016. The registered/business office of the company is located in the province
of Sindh. According to the Memorandum of Association, the objects of the
company, inter alia, include electricity generation and its sale thereof. It is
pertinent to mention that the newly incorporated company has submitted the
current application for the grant of generation licence.
(iii). The Authority observed that the above mentioned sponsors signed
a Joint Development Agreement (JDA) in Sep 2015 and Shareholders Agreement
(SHA) on May 20, 2016 for setting up the proposed 700.00 MW imported coal
fired generation facility/thermal power plant, to be located at Port Qasim Karachi
in the province of Sindh in Pakistan. According to the signed JDA and SHA the
shareholding of the sponsors will be fifty one percent (51%) for CDOIC, twenty
five percent (25%) for CMEC and twenty four percent (24%) for KEL. Further to
the said, the Authority noticed that CDOIC (subsidiary of China Datang
Corporation) undertakes investment, development, construction and management of overseas energy projects.
(iv). In consideration of the above, the Authority also observed that
China Datang Corporation (CDC), the parent company of CDOIC is one of five
(05) largest power generation corporations with assets of more than 127 GW
established in China and outside. CDC is a leading state-owned power generation
enterprise group in China with businesses and interests in the power generation,
coal mining, transportation and logistics and other sectors. The assets of CDC in
Page 6 of 15
service and under construction are located in 31 provinces of China and Burma,
Laos, Cambodia, Kazakhstan and other countries. CMEC is an internationalized
conglomerate (industry-trade-combined and technology-trade-combined), taking
engineering contracting as its core business and making trade, R&D and
international service as its main business. CMEC has been ranked among
China's top 10 contractors by business turnover from overseas contracted projects.
(v). Further to the above, the Authority is well informed that KEL is the
only vertically-integrated power utility in Pakistan that manages the generation,
transmission and distribution of electricity to the city. KEL covers an area of over
6,500 square kilometers and supplies electricity to all the industrial, commercial,
agricultural and residential areas that come under its network, comprising over 2.2
million customers in Karachi and in the nearby towns of Dhabeji and Gharo in
Sindh and Hub, Uthal, Vindar and Bela in Balochistan. In view of the said, the
Authority is of the considered view that all the sponsors of the project have strong
financial and technical expertise to develop the project.
(vi). The Authority has reviewed the information about the location of
the proposed project and has observed that the same will be located at Plot No.
EIZ/LL/SP-09 Port Qasim Area, Bin Qasim Town, Karachi. The site of the project
is at Eastern Industrial Zone of PQA withjPort Qasim Industrial Park, southeast to
the city of Karachi and on the north bank of Arabian Sea. It is about 37 km from
the city center of Karachi. The south part of the plant borders with the Arabian sea
coast beach and seaway of Port Qasim, and the north part of the plant is in close
neighborhood with the trunk road of the industrial park. The Authority is satisfied
that the sponsors have already acquired around 216 acres of land for the project from PQA.
(vii). The Authority has noticed that the proposed generation
facility/thermal power plant will be consisting of 2 x 350.00 MW super-critical units
with two boilers, two steam turbines and two generators. The boiler will be fueled
by imported bituminous/sub-bituminous imported coal (from Australia, Indonesia,
Page 7 of 15
South Africa or Botswana) which will be transported by ship and will be unloaded
at the dock to be constructed at site. A new-built pile type jetty for handling
approximately 2.50 million tons of imported coal has been planned.
(viii). In consideration of the above, the Authority considers that the
proposed supercritical technology is very mature with many units in commercial
operation for many years with good records. The selected main parameters of the
steam turbine and boiler of the project (571°C and 254 bar) are at the high end of
the supercritical class and produce high thermal efficiency that results in less
emission per unit of electricity generated. The modern emission control system
will make the technology environmentally friendly. The high efficiency of the
selected system and the low cost of coal will generate the lowest cost power and
make an economically feasible solution to relieve power shortages in Pakistan.
The gross efficiency of the proposed generation facility/thermal power plant will be
more than 41% (i.e. 42.03%) whereas the net efficiency of same will be not less than 39.00%.
(ix). The Authority considers the availability of sufficient water for the
project a very important factor for generation facilities operating on coal using
steam turbines. According to the submitted information, seawater will be the water
source of the power plant. The sea water taken into the power plant will be used
for the make-up water of the cooling water system, the others, after aeration,
chlorination, ultra filtration and sea water desalination system treatment, will be
used for boiler make-up water treatment, or as service water, potable water, fire
fighting water, etc. Sea water natural cooling tower of secondary circulation is
designed to be of water cooling type, using desalinated seawater as makeup
water. In consideration of the said, the Authority is solidified that sufficient amount
of water will be available for the operation of the proposed generation facility/thermal power plant.
(x). About the interconnection study/arrangement, the Authority has
observed that same has been carried out by Power Planners International.
According to the said study, the proposed generation facility/thermal power plant
of DTGPKPGPL will be dispersed to the system of KEL at 220 KV voltage level.
The interconnection/dispersal arrangement will be consisting of a 220 KV Double
Circuit (D/C) transmission line (Measuring about 26-KM in length on 4 x 500 mm2
Aluminum conductor) directly connecting the proposed generation facility/thermal
power plant to 220 KV New Port Qasim grid station of KEL. The Authority
observed that KEL has approved the said interconnection study.
(xi). The Authority has noted that the sponsors have also confirmed
that proposed generation facility/thermal power plant will have air emission control
equipment, including an electrostatic precipitator. Further, a catalytic reduction
system will also be installed to ensure that NOx emission complies with national
and global standards. Waste water will be treated and utilized in-plant, with a
small quantity of effluent discharged after further treatment to meet environmental
standards. Conventional solid wastes will be disposed at the ash pond, while
hazardous waste will be collected and treated in-plant. Periodic monitoring of
groundwater will be done to prevent water contamination. Efforts will be made to
maximize use of fly ash and gypsum to reduce waste disposal. Water will be
constantly sprayed in the coal yard to reduce coal dust. Sound attenuation
material will be applied on machinery generating high noise levels. Pollution
monitoring system inside and around the station will be set up to constantly
monitor the environmental conditions. For the coal based power plant, a lot of ash
is produced during its operation. In this regard, the Authority is satisfied that
DTGPKPGPL has devised a suitable plan for disposal of the said ash.
DTGPKPGPL has confirmed that ash produced will be collected and transported
to various cement plants located nearby where it will be utilized as raw material.
(xii). The Authority considers environmental issues resulting from the
construction and operation of the proposed generation facility/thermal power
plant, very important. In this regard, the sponsors have confirmed that the
proposed generation facility/thermal power plant will comply with the
environmental standards of the country. Further, DTGPKPGPL has provided a
copy of the NOC issued by EPA, Sindh confirming that the project will be
compliant with NEQs and the same will be followed.
Page 9 of 15
(xiii). In terms of Rule-3 of the Generation Rules, the Authority may
grant a generation licence to any person to engage in the generation business.
The said rule stipulates various conditions pertaining to the grant of generation
licence as explained in Rule-3(2), Rule-3(3), Rule-3(4), Rule-3(5) and Rule-3(6).
In the particular case under consideration, the conditions of Rule-3(2) and Rule-
3(3) stands satisfied as DTGPKPGPL has provided details of location,
technology, size, net capacity, interconnection arrangements, technical limits,
technical functional specifications and other details specific to the generation
facilities. The provision of Rule-3(4) of the Generation Rules regarding holding a
public hearing is not applicable as there is no issue which require this exercise.
The Rule-3(5) of the Generation Rules stipulates that the Authority may refuse to
issue a licence where the site, technology, design, fuel, tariff or other relevant
matters pertaining to the generation facility/thermal power plant proposed in an
application for a generation licence are either not suitable on environmental
grounds or do not satisfy the least cost option criteria. In this regard, the Rule-3 of
the Generation Rules also stipulates the conditions pertaining to least cost option
criteria which include (a). sustainable development or optimum utilization of the
renewable or non-renewable energy resources proposed for generation of electric
power; (b). the availability of indigenous fuel and other resources; (c). the
comparative costs of the construction, operation and maintenance of the
proposed generation facility/thermal power plant against the preferences indicated
by the Authority; (d). the costs and rights-of-way considerations related to the
provision of transmission and interconnection facilities; (e). the constraints on the
transmission system likely to result from the proposed generation facility/thermal
power plant and the costs of the transmission system expansion required to
remove such constraints; (f). the short-term and the long-term forecasts for
additional capacity requirements; (g). the tariffs resulting or likely to result from the
construction or operation of the proposed generation facility/thermal power plant;
and (h) the optimum utilization of various sites in the context of both the short-
term and the long-term requirements of the electric power industry as a whole.
Page 10 of 15
(xiv). In consideration of the above, it is clarified that the project is being
developed in terms of the up-front tariff determination whereby the Authority has
fixed various parameters of the project including efficiency (net), cost of the
construction/EpC cost, operation and maintenance costs etc. In the said
determination, the Authority has duly considered the cost of power generation for
various other alternatives and has fixed the parameters accordingly which is very
reasonable cost for the end consumer. The sponsors of the project had carried
out the grid interconnection study which concludes that a 220 KV D/C
transmission line (Measuring about 24-KM) will be required to connect the project
with the system of KEL. Further, the study has confirmed that the project will not
face any constraints in transmission system. Further, being located at reasonable
distance from the thick population, the project will not result in costs and right-of-
way issues for the provision of transmission and interconnection facilities. It is
pertinent to mention that KEL has included the project in its medium-term and the
long-term forecasts for additional capacity requirements. In view of the
explanation given above, the Authority considers that the project fulfils the
requirements of least cost option criteria as envisaged in the Generation Rules.
(xv). The Authority has considered the comments of the stakeholders
and has observed that MoP&NR, Bol, EDB, MoP&S, PQA has supported the
grant of generation licence in explicit terms. However, PPIB has informed about
the decision of the Government of Pakistan to ban new projects on imported fuel.
Further, MoW&P has also confirmed the said position as highlighted by PPIB. In
consideration of the said, the Authority is of the considered opinion that KEL
being separate legal entity entrusted with the responsibilities to cater the load
requirements of the metropolitan city of Karachi. In this regard, KEL can either set
up generation facilities from its resources or can purchase electric power from the
third party power plants. The Authority is of the view that considering the location
of the city of Karachi, the best option available for generation facilities to be set up
include facilities using imported fuels like coal and LNG. The Authority is of the
considered option that if the argument of PPIB and MoW&P is accepted then it
will not be possible for KEL to meet its demand for which it is obligated.
Page 11 of 15
Accordingly, the Authority gives its determination that ban imposed by the board
of PPIB is not applicable to projects being set up in Karachi that will be supplying
electric power to KEL only. It is pertinent to mention that the project of
DTGPKPGPL is a private venture and it will not be availing any concessions or
other benefits from the Government of Pakistan as admissible to projects set up
under the different power policies therefore, the ban imposed will not be
applicable to this project. In view of the said, the observations of PPIB and MoW&P stand addressed.
(E). Grant of Licence
(I). Electricity is a fundamental element for the economic growth of
any country. The electricity consumption per capita has a strong correlation to the
social development indices (human development index, life expectancy at birth,
infant mortality rate, and maternal mortality) and economic indices (such as GDP per capita).
(ii). Karachi is the largest and the most populous city of Pakistan. The
city maintains itself as the premier center of banking, industry, economic activity
and trade, and is home to Pakistan's largest corporations, including textiles, gems
and jewelry, shipping, automotive industry, entertainment, arts, fashion,
advertising, software development and medical research. This city is the centre to
economy of Pakistan and contributes 42% of GDP, 70% of income tax revenue
and 62% of sales tax revenue. The GDP of Karachi is around 20% of the total
GDP of Pakistan. Moreover, Karachi accounts for 30% of small and medium scale
manufacturing and 40% of large-scale manufacturing of the country. Further,
Karachi contributes about 20% of total national output and 30% of total industrial
output. Around 95% of the foreign trade of Pakistan relies on the two ports of
Karachi i.e. Port Qasim and Karachi Port at Kemari. In consideration of the above,
the Authority is of the considered opinion that increasing the electricity
consumption in the city of Karachi can directly stimulate faster economic growth
and may result in enhanced social development in the city in particular and in the
country in general. In view of the said, the Authority considers that for sustainable
Page 12 of 15
development, all types of electric power generation resources available to the city
must be developed on priority basis as these will result in adequate supply of electric power for Karachi.
(iii). The existing energy mix for the city of Karachi is heavily skewed
towards the generation facilities/thermal power plants, operating on furnace oil.
The prices of furnace oil are very volatile and resultantly cause frequent variation
in the consumer end tariff not only resulting in higher inflation but also affects the
competitiveness of the local industry with its foreign peers. In order to address the
said issues, the Authority considers it imperative that efforts must be made to
change the energy mix of KEL towards cheaper fuels. In this regard, the Authority
considers that generation facilities based on imported/local coal are considered
the best option for KEL in the medium and long term. Therefore, to reduce the
demand-supply gap in the area of KEL and to achieve sustainable development
for the city of Karachi, it is vital that indigenous as well as imported coal based
projects are given priority for power generation and their development is
encouraged. In consideration of the said, the Authority is of the view that the
proposed project of DTGPKPGPL will be helpful in mitigating the demand-supply gap in the city of Karachi.
(iv)• As explained above, DTGPKPGPL has provided the details of
location, technology, size, net capacity, interconnection arrangements, technical
details and other related information for the proposed generation facility/thermal
power plant. The sponsors of the project have acquired the required land for
setting up the generation facility/thermal power plant. The details of the land
coordinates have been incorporated in Schedule-I of the proposed generation
licence. Accordingly, the Authority directs DTGPKPGPL to utilize the allocated
land for the specific purpose of setting up the proposed generation facility/thermal
power plant and bring the matter in its notice if there is any deviation in the plan about the use of land.
Page 13 of 15
Page 14 of 15
(v). The term of a generation licence under Rule-(5)(1) of the
Generation Rules is required to match with the maximum expected life of the units
comprised in a generating facility. According to the information provided by
DTGPKPGPL, the COD of the proposed generation facility/thermal power plant
will be of December 31, 2020 and it will have a useful life of more than thirty (30)
years from its COD. In this regard, DTGPKPGPL has requested that the term of
the proposed generation licence may be fixed to thirty (30) years, consistent with
the term of the proposed Power Purchase Agreement (PPA) to be signed with
KEL. In this regard, the Authority considers that as per international
benchmark/standards the life of a brand new steam turbine is taken as at least
thirty (30) years. The Authority considers that the information provided by
DTGPKPGPL about the useful life of its generation facility/thermal power plant is
consistent with international benchmarks and other similar cases. Therefore, the
Authority fixes the term of the generation licence as thirty (30) years from COD of the project.
(vi). Regarding tariff, it is hereby clarified that under Section-7(3)(a) of
the NEPRA Act, determination of tariff, rate and charges etc. is the sole
prerogative of the Authority. In the particular case, the Authority has already
granted an upfront tariff to the project through its determination No. NEPRA/TRF-364
/DPKPG-2016/11068-11070 August 11, 2016. Notwithstanding the said, the
Authority directs DTGPKPGPL to charge the power purchaser only such tariff
which has been determined, approved or specified by the Authority. In this regard,
the Authority has made explicit provision in the Article-6 of the generation licence
for DTGPKPGPL. The Authority directs DTGPKPGPL to adhere to the provision
of the said article of the generation licence in letter and spirit without any exception.
(vii). Regarding compliance with the environmental standards, as
stated at Para-D(xii) above, DTGPKPGPL has provided the NOC from EPAGoS
and has confirmed that project will comply with the required standards during the
term of the generation licence. In view of the importance of the issue, the
Authority has decided to include a separate article (i.e. Article-10) in the
Page 15 of 15
Si
generation licence along with other terms and conditions making it obligatory for
DTGPKPGPL to comply with relevant environmental standards at all times.
Further, the Authority directs DTGPKPGPL to submit a report on a bi-annual
basis, confirming that operation of its generation facility/thermal power plant is
compliance with the required environmental standards as prescribed by the
concerned environmental protection agency.
(viii). In view of the above, the Authority hereby approves the grant of
generation licence to DTGPKPGPL on the terms and conditions set out in the
generation licence annexed to this determination. The grant of generation licence
will be subject to the provisions of the NEPRA Act, relevant rules, regulations
framed thereunder and other applicable documents.
Authority:
Maj. (R) Haroon Rashid (Member) P In 17
Syed Masood-ul-Hassan Naqvi (Member)
Himayat Ullah Khan (Member)
Saif Ullah Chattha (Member)/(Vice Chairman)
Brig. (R) Tariq Saddozai (Chairman)
*ER RE-Go 4k6'
171 REGISTRAR _,A
<6.,
NEPO e
Registrar .)--Z
National Electric Power Regulatory Authority (NEPRA)
Islamabad — Pakistan
[GENERATION LICENCE
No. IGSPL/79/2017
In exercise of the Powers conferred upon under Section-15 of the
Regulation of Generation, Transmission and Distribution of Electric
Power Act, 1997, the Authority hereby grants the Generation Licence
to:
DATANG PAKISTAN KARACHI POWER GENERATION
(PVT.) LIMITED
Incorporated Under Sectioon-32 of the Companies Ordinance 1984 (XL VII of 1984) Having Corporate Universal
Identification No. 0099889, dated May 26, 2016
for its Imported Coal based Generation Facility/Thermal Power Plant Located at Plot No. EIZ/LL/SP-09, Port Qasim Area, Bin Qasim Town, Karachi in the Province of Sindh
(Total Installed Capacity: 700.00 MW Gross)
to engage in generation business subject to and in accordance with the
Articles of this Licence.
Given under my hand this on Z3 w t̀ day of May Two Thousand
& Seventeen and expires on 30th day of December Two
Thousand & Fifty.
ER RE
i4J({9 W REGISTRAR cv
NFPitt"
Article-1 Definitions
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
Bin Qasim Town, Karachi in the Province of Sindh
1.1 In this licence
(a). "Act" means the Regulation of Generation, Transmission and
Distribution of Electric Power Act, 1997 as amended or replaced from
time to time;
(b). "Applicable Documents" mean the Act, the rules and regulations
framed by the Authority under the Act, any documents or instruments
issued or determinations made by the Authority under any of the
foregoing or pursuant to the exercise of its powers under the Act, the
Grid Code, the applicable Distribution Code, if any, or the documents
or instruments made by the Licensee pursuant to its generation
licence, in each case of a binding nature applicable to the Licensee or,
where applicable, to its affiliates and to which the Licensee or any of its
affiliates may be subject;
(c). "Applicable Law" means the Act, relevant rules and regulations made
there under and all the Applicable Documents;
(d). "Authority" means the National Electric Power Regulatory Authority
constituted under Section-3 of the Act;
(e). "Bus Bar" means a system of conductors in the generation
facility/Thermal Power Plant of the Licensee on which the electric
power from all the generators is collected for supplying to the Power Purchaser;
(f). "Commercial Operations Date (COD)" means the day immediately
following the date on which the generation facility/Thermal Power Plant
of the Licensee is commissioned;
Page 2 of 7 of the Articles of Generation Licence
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
(g)•
"Distribution Code" means the distribution code prepared by the
distribution licensee and approved by the Authority, as it may be
revised from time to time with necessary approval of the Authority;
(h). "Generation Rules" mean the National Electric Power Regulatory
Authority Licensing (Generation) Rules, 2000 as amended or replaced
from time to time;
"Grid Code" means the grid code prepared by NTDC and approved by
the Authority, as it may be revised from time to time by NTDC with any
necessary approval by the Authority;
(j). "IEC" means the International Electrotechnical Commission or its
successors or permitted assigns;
(k). "IEEE" means the Institute of Electrical and Electronics Engineers or its
successors or permitted assigns;
(I). "KEL" means K-Electric Limited or its successors or permitted assigns as a Power Purchaser;
(m). "Licensee" means "Datanq Pakistan Karachi Power Generation (Pvt.) Limited" or its successors or permitted assigns;
(n). "Licensing Regulations" mean the National Electric Power Regulatory
Authority Licensing (Application & Modification Procedure)
Regulations, 1999 as amended or replaced from time to time;
(o). "NTDC" means National Transmission and Despatch Company Limited
or its successors or permitted assigns;
Page 3 of 7 of the Articles of Generation Licence
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
Bin Qasim Town, Karachi in the Province of Sindh
"Power Purchase Agreement (PPA)" means the power purchase
agreement, entered or to be entered into by and between the Power
Purchaser and the Licensee, for the purchase and sale of electric
power generated by the generation facility/Thermal Power Plant, as
may be amended by the parties thereto from time to time;
"Power Purchaser" means KEL which will be purchasing electric power
from the Licensee, pursuant to the PPA for procurement of electric power;
(r). "Thermal Power Plant" means a generation facility using fossil fuel for
generation of electric power;
1.2 Words and expressions used but not defined herein bear the meaning given
thereto in the Act or rules and regulations issued under the Act.
Article-2 Applicability of Law
This licence is issued subject to the provisions of the Applicable Law, as
amended from time to time.
Article-3 Generation Facilities
3.1 The location, size (capacity in MW), technology, interconnection
arrangements, technical limits, technical functional specifications and other details
specific to the generation facility/Thermal Power Plant of the Licensee are set out in
Scheduled of this licence.
3.2 The net capacity of the generation facility/Thermal Power Plant of the
Licensee is set out in Schedule-II hereto. The Licensee shall provide the final
arrangement, technical and financial specifications and other specific details
pertaining to its generation facility/Thermal Power Plant before its COD.
Page 4 of 7 of the Articles of Generation Licence
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Article-4 Term of Licence
4.1 This Licence shall become effective from the date of its issuance and will
have a term of thirty (30) years from the COD of the generation facility/Thermal
Power Plant of the Licensee.
4.2 Unless suspended or revoked earlier, the Licensee may apply for renewal of
this Licence ninety (90) days prior to the expiry of the above term, as stipulated in the Licensing Regulations.
Article-5 Licence fee
The Licensee shall pay to the Authority the licence fee as stipulated in the
National Electric Power Regulatory Authority (Fees) Rules, 2002 as amended or
replaced from time to time.
Article-6 Tariff
The Licensee shall charge the Power Purchaser only such tariff which has
been determined, approved or specified by the Authority.
Article-7 Competitive Trading Arrangement
7.1 The Licensee shall participate in such manner as may be directed by the
Authority from time to time for development of a Competitive Trading Arrangement.
The Licensee shall in good faith work towards implementation and operation of the
aforesaid Competitive Trading Arrangement in the manner and time period specified
by the Authority. Provided that any such participation shall be subject to any contract
entered into between the Licensee and another party with the approval of the Authority.
Page 5 of 7 of the Articles of Generation Licence
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
Bin Qasim Town, Karachi in Province of Sindh 7.2 Any variation or modification in the above-mentioned contracts for allowing
the parties thereto to participate wholly or partially in the Competitive Trading
Arrangement shall be subject to mutual agreement of the parties thereto and such
terms and conditions as may be approved by the Authority.
Article-8 Maintenance of Records
For the purpose of sub-rule (1) of Rule-19 of the Generation Rules, copies of
records and data shall be retained in standard and electronic form and all such
records and data shall, subject to just claims of confidentiality, be accessible by
authorized officers of the Authority.
Article-9 Compliance with Performance Standards
The Licensee shall comply with the relevant provisions of the National Electric
Power Regulatory Authority Performance Standards (Generation) Rules, 2009 as
amended or replaced from time to time.
Article-10 Compliance with Environmental & Safety Standards
10.1 The generation facility/Thermal Power Plant of the Licensee shall comply with
the environmental and safety standards as may be prescribed by the relevant
competent authority from time to time.
10.2 The Licensee shall provide a certificate on a bi-annual basis, confirming that
the operation of its generation facility/Thermal Power Plant is in conformity with
required environmental standards as prescribed by the relevant competent authority.
Article-11 Power off take Point and Voltage
The Licensee shall deliver the electric power to the Power Purchaser at the
outgoing Bus Bar of its generation facility/Thermal Power Plant. The Licensee shall
be responsible for the up-gradation (step up) of generation voltage up to the
required dispersal voltage level.
44/
REGISTRAR r--
4)
NEPRA
Page 6 of 7 of the Articles of Generation Licence
Article-12 Provision of Information
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
Bin Qasim Town, Karachi in the Province of Sindh
In accordance with provisions of Section-44 of the Act, the Licensee shall be
obligated to provide the required information in any form as desired by the Authority
without any exception.
Article-13 Design & Manufacturing Standards
The generation facility/Thermal Power Plant of the Licensee shall be
designed, manufactured and tested according to the latest IEC, IEEE or other
equivalent standards. All the plant and equipment of the generation facility/Thermal
Power Plant shall be unused and brand new.
Page 7 of 7 of the Articles of Generation Licence
Page 1 of 11 of Schedule -I
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
SCHEDULE-I
The Location, Size (i.e. Capacity in MW), Type of Technology, Interconnection Arrangements, Technical Limits, Technical/Functional Specifications and other details specific to the Generation Facilities of
the Licensee are described in this Schedule
4,kEit RE
Re0S-r"4C
* N EPik
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Location of the Generation Facility/Thermal Power Plant
of the Licensee
Page 2 of 11 of Schedule -1
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Location of the Generation Facility/Thermal Power Plant
of the Licensee
Page 3 of 11 of Schedule -I
Boundary
Boundary-1
Boundary-2
Boundary-3
Boundary-4
Boundary-5
Boundary-6
Boundary-7
Project Land: 216 Acres
Land Coordinates
Latitude (N)
24°4T04.9153"N
24°4T06.3026"N
24°47'22.4826"N
24°4T23.2850"N
24°46'50.9262"N
24°47.48.7354"N
24°47'04.9153"N
Longitude (E)
67°2315.0842"E
67°23'43.9531"E
67°23'43.0207"E
67°23'59.7312"E
67°24'01.6233"E ■-•■••■••coli
67°2316.01761M
67°23'15.0842"E
\NER RF
JI REGISTRAR
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Land Coordinates of the Generation Facility/Thermal Power Plant
of the Licesee
Page 4 of 11 of Schedule -1
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi
Lay Out of the in the Province of Sindh
Generation Facility/Thermal Power Plant of the Licensee
I. 1
l p 41 4
lid 11111111111111 nnnnnn nnnnn nnm.nn~nmm~nnn_-
11 1 1 1 11
SP 12
Page 5 of 11 of Schedule -I
Page 6 of 11 of Schedule -I
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Single Line Diagram (Electrical) of the Generation Facility/Thermal Power Plant
of the Licensee
Page 7 of 11 of Schedule -I
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Interconnection Facilities/ Transmission Arrangements for Dispersal of Power from the
Generation Facility/Thermal Power Plant of the Licensee
The electric power from the imported coal based generation
facility/Thermal Power Plant of the Licensee will be dispersed to the load center
of K-Electric Limited (KEL).
(2). The interconnection facilities/transmission arrangements for supplying to
national grid from the above mentioned generation facility/Thermal Power Plant
shall be at 220kV level. The dispersal/interconnection arrangement for supplying
to KEL will be consisting of a 220kV Double Circuit (D/C) Transmission line
(measuring about 26-KM in length on 4 x500 mm2 Al conductor) connecting
generation facility/Thermal Power Plant of the Licensee to the new 220 KV Port
Qasim 220kV grid station of KEL.
(3). Any change in the above mentioned interconnection facilities/transmission
arrangements for dispersal of electric power as agreed by the Licensee and the
Power Purchaser/KEL shall be communicated to the Authority in due course of
time.
PlpIlYVvw1
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Single Line Diagram of the Interconnection Facilities/ Transmission Arrangements for Dispersal of Power from the
Generation Facility/Thermal Power Plant of the Licensee
VW
Page 8 of 11 of Schedule -I
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
Details of Generation Facility/Thermal
Power Plant
(A). General Information
(i). Name of Company/Licensee
Datang Pakistan Karachi Power Generation (Pvt.) Limited
(ii). Registered /Business Office of Company/ Licensee
RIAA Barker Gillete Chambers, D-67/1, Block-4, Clifton, Karachi
(iii). Location of the Generation Facility
Port Qasim, Karachi, in the Province of Sindh.
(iv). Type of Generation Facility Coal Fired Thermal Power Plant
(B). Plant Configuration
(i). Installed Capacity/ Plant Size of the Generation Facility
700.00 MW
(ii). Type of Technology Conventional Thermal Power Generation Facility with Super Critical Boiler and Steam Turbine
(iii). Number of Units/Size (MW) 2 x 350.00 MW
(iv).
Unit Make/ Model/ Type & Year of Manufacture Etc.
Steam turbine
Super Critical, Condensing Steam Turbines of Shanghai
Electric Group Company/Dongfang Turbine
Corp. Limited/Harbin Turbine Co. Limited
/ALSTOM/Siemens/Hitachi/ Toshiba or equivalent.
Boiler
Supercritical thermal power unit once through single pass single reheat, balanced draft radiant furnace, dry bottom Boiler of
Shanghai Electric Group Company/Dongfang Boiler Corp.
Limited/Harbin Boiler Co. Limited/ALSTOM/B&W (Beijing)
Co. Limited/Ansaldo/Foster Wheeler or equivalent.
/0344ER Ree, Zi.,%-------14\
Page 9 of 11 of Schedule -I 44J
Li; REGISTRAR
-L j * NE PO
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
(v). COD ration Facility
of the G December 31, 2020 (Expected)
(vi). Expected Useful Life of the Generation Facility from COD
30 years
(C). Fuel/Raw Material Details
(i). Primary Fuel Imported Coal
(ii). Start-Up Fuel Light Diesel Oil (LDO)
(iii). Fuel Source
Primary Fuel Start-Up Fuel
Bituminous/ Sub-Bituminous
Coal from Indonesia, South Africa etc.
Indigenous/Imported
(iv). Fuel Supplier
Primary Fuel Start-Up Fuel
China Datang Overseas Investment
Company Limited.
PSO/Shell/ any other OMC Company.
(v)* Arrangement
Primary Fuel Start-Up Fuel
Through ShipsNessel/Barge, Jetty and Trucks etc.
Through Oil Tankers
(vi). No. of Storage Bunkers/Tanks/ Open Yard
Primary Fuel Start-Up Fuel
One open yard One Tank
(vii). Storage Capacity of each Bunkers/ Tanks/Open Yard
—erriZzt■
Primary Fuel Start-Up Fuel
Approx. 650,000 tons 500m3
Page 10 of 11 of Schedule -I
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi
(viii). Gross Storage Primary Fuel Start-Up Fuel
Approx. 650,000 tons 500m3
(I)). Emission Values
Primary Fuel Start-Up Fuel
(i). SOX (mg/Nm3) 350 As per NEQ
(ii). NOx (mg/Nm3) 510 As per NEQ
(iii). Particulate Matter (mg/Nm3) 50 As per NEQ
(E). Cooling System
Cooling Water Source/Cycle
Secondary circulating cooling tower and makeup seawater from Arabian Sea
(F). Plant Characteristics
0). Generation Voltage 20 KV (Transmission Voltage 220 KV)
(ii). Frequency 50Hz (± 5%)
(iii). Power Factor 0.8 to 0.9
(iv). Automatic Generation Control
Yes
(v). Ramping Rate (MW/min)
Between 50%-100%
Load
Between 25% to 50%
Load
Under 25% of
load 2 x 6.65 MW/min
2 x 4.2 MW/min
2 x 3.5 MW/min
(vi). Time required to Synchronize to Grid (Hrs.)
-
Hot Start
Warm Start
Cold Start
60
-
150 264
Page 11 of 11 of Schedule -1
Page 1 of 2 of Schedule-II
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
Bin Qasim Town, Karachi in the Province of Sindh
SCHEDULE-II
The Installed/ISO Capacity (MW), De-Rated Capacity At Mean Site Conditions (MW), Auxiliary Consumption (MW) and the Net Capacity
At Mean Site Conditions (MW) of the Generation Facilities of Licensee are given in this Schedule
Page 2 of 2 of Schedule-II
Generation Licence Datang Pakistan Karachi Power
Generation (Pvt.) Limited Plot No. EIZ/LL/SP-09, Port Qasim Area
, Bin Qasim Town, Karachi in the Province of Sindh
SCHEDULE-!I
(1). Total/Gross Installed Capacity of the generation facility/Thermal Power Plant
700.00 MW
(2). De-rated Capacity of the generation facility/Thermal Power Plant at Reference Site Conditions
700.00 MW
(3). Auxiliary Consumption of the generation facility/Thermal Power Plant
63.00 MW
(4). Net Capacity of the generation facility/Thermal Power Plant at Reference Site Conditions
637.00 MW
Note
All the above figures are indicative as provided by the Licensee. The net
capacity available to the Power Purchaser for dispatch will be determined through
procedure(s) contained in the PPA or any other applicable document(s).