Karachi residents merely need to keep their fingers crossed for better times to come. As K-Electric has designed a Power Purchasing Program (PAP) to provide access to affordable power to its customers by focusing on the reduction of its power generation expenses through the introduction of local and renewable energy resources, the new year 2024 may start bright and continue to shine throughout the years to come.
The six-year program (FY 24 – FY 30) is a supplement to KE’s PKR 484 billion investment plan in transmission and distribution, which was developed and submitted for NEPRA’s approval. The generation chosen under this Program will be dictated by the accessibility of the grid and transmission capacities expected under the investment plan.
The PAP was created in a way that is consistent with national goals that have been defined in the Indicative Generating Capacity Expansion Plan (IGCEP), which is to increase the share of renewable energy in the generating mix by up to 60%. By making the most use of the local resources that are already available, the increased generation will allow K-Electric to reliably and sustainably supply the load and energy demand. Every Karachiite will receive reliable electricity through this program at a reasonable price.
Regarding local resources, K-Electric has already gathered accurate data on wind and solar in the area of its renewable corridors in order to forecast future energy generation and the annual pattern of generation.
The capacity utilization factor was derived, respectively, from solar and wind power plants.
The growth of coal power generation is dependent on the financial and technological backing of foreign companies. In order to analyze the viability of the development of coal-based projects and to get further clarity in this area, KE is now interacting with all relevant parties.
In addition, in February, KE signed an MOU with China Three Gorges South Asia Investment Limited (CTGSAIL), a significant player in Pakistan’s energy industry with generation assets worth more than PKR 6 billion. In parallel, KE is also actively involved with Hydel, the developers of KPK and AJK.
According to the MoU, both businesses are aiming to provide Pakistan’s citizens, especially K-Electric’s expanding base of more than 3.4 million consumers, with access to affordable, sustainable power.
Similar collaborations with K-Electric, the Sindh Energy Department (SED), and the World Bank are underway to create a 350 MW solar park as part of the “Sindh Solar Energy Project” (SSEP). This triple agreement aims to boost Sindh Province’s solar energy production and access to electricity while also creating and operating utility-scale IPPs in Karachi that are competitive, economical, and sustainable.
As an emerging economy, a country’s need for electricity correlates with its GDP. The availability of dependable, sufficient, and inexpensive energy is a precondition for the growth and development of the economy. Accordingly, the socioeconomic strength of a nation is expressed by its per capita energy consumption and access to electricity.
Pakistan’s per-capita usage is 6441 kWh while India’s is 1,2182 kWh. As a result, it was essential to conduct planning in a way that would maintain a consistent supply, which is essential for Pakistan’s economy and socioeconomic growth. A new period of wealth and progress will begin with the introduction of PAP in Karachi, the country’s commercial center.
K-Electric is presently working on a Variable Renewable Energy (VRE) study to determine how much renewable energy can be included in the KE network without jeopardizing network dependability. The proposed PAP makes the assumption that all of the suggested renewable projects, as outlined in this Programme, will be implemented, pending the findings of the ongoing VRE study, and without incurring any additional costs for the development of spinning reserves, contingency funds, or transmission augmentation that might differ from the Transmission System Investment Plan.
With the addition of generation projected from multiple generating technologies, with the majority of the electricity coming from renewables, i.e., Solar 900 MW and Wind 200 MW until FY 2030, the proposed PAP gives the most prudent scenario of K-Electric’s long-term purchase strategy.
In addition, it is also suggested that 82 MW of hydropower be included in the generation mix in FY 2029. By reducing our dependency on imported fuels, these developments will not only help the nation’s carbon emissions but also benefit the national exchequer by reducing spending.
The cost of producing electricity is impacted by changes in these fuels’ pricing around the world, and these changes are communicated to customers monthly in the form of Fuel Charge Adjustments. Thus, the use of renewable energy may also benefit customers by lowering the monthly fees that are levied.