Closure of Neelum-Jhelum project costing Rs10 billion extra per month to consumers
ISLAMABAD-Senate Committee on Power was Tuesday informed that the closure of Neelum-Jhelum hydropower project was costing Rs10 billion extra per month to power consumers as the restoration work on the project will be completed by June next year.
The Senate Standing Committee on Power that met with Senator Saifullah Abro in the chair has also recommended the Power Division to take necessary action against the irregularities in the award of Nandipur contract and provide details of officials, who were in-charge at that time. The committee also directed the Power Division to provide bidding details of Haveli Bahadur Shah Power Plant, Neelum-Jhelum hydropower plant, Bhikki combined-cycle power plant in the next meeting.
On Neelum-Jhelum it was informed that there is a significant pressure of the mountain on the underground tunnel. The committee was informed that the project was completed without financial close. Chairman NEPRA Tauseef H.Farooqi said that Neelum-Jhelum project is closed since July, which is costing Rs 10b extra per month to the consumers by providing them electricity generated from expensive sources.
Neelum Jhelum official informed that tail race tunnel was fully settled up to 42 meters. A team of international experts gave two preliminary reports after inspecting the tunnel, the official added. The experts have identified eight causes of tunnel collapse, and final report has yet to come, said official of Neelum Jhelum. The Neelum-Jhelum official informed that tunnel rehabilitation work would be completed by June with the cost of Rs 2.3b. However, Chairman NEPRA was of the view that the work of the tunnel will be done again but what is the guarantee that it will not collapse later.
Chairman NEPRA said that if this tunnel remains closed for a year, consumers will suffer a loss of Rs 120b. The biggest fear is what will happen if the rest of the tunnel collapses, Chairman Nepra added. The Senate body directed WAPDA to submit independent expert interim report on Neelum-Jhelum before the committee in the next meeting. The committee discussed the circular debt of K-Electric, which currently stands at Rs.300 billion as of October, 2022 evaluation. Additional Secretary Power Division, Arshad Majeed informed the committee that Prime Minister Shehbaz Sharif has constituted the committee under the supervision of Khaqan Abbasi to probe the matter. Senator Saifullah Abro told that committee was formed in June 2022 and questioned as to what measures the ministry has taken earlier. He further directed the K-Electric to pay the circular debt of Rs.58 billion of year 2008 on which the K-Electric agreed. Chairman Committee has questioned that why K-Electric has not deposited Rs 58b of circular debt till now?. Initially the circulation debt was created due to KE in 2008, while later everyone played its role in its accumulation, Abro claimed.
Chairman Committee instructed the Additional Secretary Power Division to bring a check of Rs 58b from K-Electric in the next meeting. K-Electric should pay the dues of 2008, he said and added that “do not connect this issue with the current affairs,”. The committee deferred the matter and decided to conduct meeting on the said matter within a week.
The Senate Committee showed displeasure over the absence of Federal Minister, Secretary of Power Division and CEO of K-Electric. The chair stated that the minister has not attended even a single meeting from the last seven months. He further added that the committee has made numerous recommendations to Power Division and unfortunately none has been implemented so far. The committee decided and directed the Ministry to provide feedback on thirteen important recommendations / issues within 10 days time. The Senate body asked the Power Division as to how the government is going to run the public sector power plants, when the government has failed to appoint CEOs of GENCO I, II and GENCO holding companies. The efficiency of state owned generation power plants is 31% while the efficiency of private power plants is up to 60%, MD GENCO Holding Company said. “You have scrapped government power plants, how will they be restored,” Chairman Committee remarked. All government power plants are running without CEO and chief engineers, he added.
Furthermore, the committee was also briefed by the officials of Nandipur Power Plant with respect to bidding process followed in award of project. Officials informed that the advertisement was initially published for ‘Chichoki Malian’ project and three firms participated in bidding process which includes Alstom-Marubeni, Dongfang Electric Corporation Ltd. and Harbin Power Engineering Company Limited. However, lately, government awarded the ‘Nandi Power Plant’ to lowest bidder instead of ‘Chichoki Malian’ project. Senator Saifullah Abro reiterated that there is clear evidence of irregularities and government could not initiate bidding process on one project and award another project to the same bidder because both the projects were located in different locations and have different estimated cost.
Chairman NEPRA said that legally, such a change of place is not allowed. The Nandipur official said that this change was approved by the then government. Member Committee Asad Junejo asked “Can the government give such approval?” Even ECNEC cannot give such approval, chairman of the Committee said and added that it should have been re-tendered. Re-tenders and bidding process for the project could have been completed in a month, Abro added. Chairman committee directed to call Nespak officials in the next meeting for briefing on the matter. Nespak has played havoc, he added. Saifullah Abro said that in the last meeting, Nandipur officials said that one company had given the bid, whereas there were actually three companies that had given the bid. An Iranian company had also shown interest in bidding, but it was pulled out, chairman Committee said.
Article source: https://www.nation.com.pk/23-Nov-2022/closure-of-neelum-jhelum-project-costing-rs10-billion-extra-per-month-to-consumers