ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Friday granted a provincial grid licence to Khyber Pakhtunkhwa Transmission & Grid System Company (Private) Limited (KPT&GSC).

The licence empowers the KPT&GSC – a subsidiary of the provincial government – to act as a provincial grid company under Section-18A of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997.

KP is the second province after Sindh to have secured a provincial transmission or grid company. The KPT&GSC licence “will facilitate in connecting the under construction as well as future proposed hydropower projects to the designated load centers, not only in the province, but will also help in transporting cheap electricity to national grid thus paving the way for development of the province as well as for the country,” Nepra said.

The regulator had conducted a public hearing on KP’s request for a provincial grid licence on Feb 9. The Central Power Purchasing Agency and National Transmission & Dispatch Company (NTDC) had opposed the petition.

The provincial government had criticised NTDC of the federal government to have ignored provincial transmission lines to connect cheaper energy with the national grid and for failing to complete its own projects in time.

The KP government has been pushing for the transmission and grid system licence to ensure evacuation of about 7,300MW of its local power generation lined up through substantial public and private (local and foreign) investment. It also advocates that the provincial grid company would emerge as a support to the country’s ailing power market and help stabilise the national grid in events like the recent countrywide power breakdown.

The provincial government has stated that various hydropower projects currently in different stages of implementation in KP would make available about 7,320MW of cheaper electricity over the next 10-15 years.

These plants are located in Chitral, Dir, Kohistan, Swat and Mansehra. The evacuation of half of the above power of nearly 3,500MW and mainly from Chitral and Swat regions was a great challenge for KP as the Commercial Operation Dates (CODs) would stand matured by 2027.

“KP has unfortunately encountered indefinite delays from the NTDC which had its own impediments. Firstly, the NTDC was focused towards electricity evacuation as dictated by Indicative Generation Capacity Expansion Plans (IGCEPs) that were further tied up with government directives and priorities. Secondly, difficult northern terrains to find suitable transmission corridors also delayed in mega hydropower projects on the national level besides internal limitations of the NTDC”.

Quoting the recent countrywide blackout, the KP government said that had the KPT&GSC been fully operational even the half of 7322MW on bars would have averted the breakdown with the help of latest technology by isolating its network to ‘island mode’ and help early restoration.

Financially, the KP government asserted that the delay in evacuation of power under the NTDC’s plans would cause a big blow to the province’s power expansion plans as hundreds of millions of dollars injected by investors into these HPPS will turn non-productive and provide zero return to investors for years and deprive the province of about Rs2 trillion revenue in 20-25 years.

On top of that, the presence of multiple grid companies would develop the competitive electricity market instilling an element of competition to NTDC instead of living in old ages.

Published in Dawn, February 27th, 2021