ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has expressed concerns over long delays in laying transmission lines that have caused enormous financial losses, and have led to grid system instability and capacity problems in absorbing additional loads.

“There are 14,500 kV grid stations with 33 transformers at the 500/220 kV level. Out of these, 13 transformers are loaded above 80 per cent of their rated capacity,” said Nepra in its latest State of the Industry Report 2016-17 adding “out of the total 143 220/132 kV transformers, 79 are overloaded — representing about 55pc overloading in the system”.

The regulator said progress reports of ongoing power evacuation projects and development projects of the National Transmission and Dispatch Company (NTDC) showed that it could not complete several projects on scheduled deadlines, which were repeatedly extended. “Failure to complete projects results not only in cost over-runs but also forces uneconomic power dispersal”.

Regulator says failure to complete projects on time results not only in cost overruns but also forces uneconomic power dispersal

For instance, the NTDC failed to construct interconnection facilities for the 404MW Uch-II, and the 747MW Guddu Power Plants, resulting in them both not being operated at full capacity. In response to explanations called by the regulator, the NTDC admitted the delays and the consequent load curtailment.

It said the Uch-II Power Plant was commissioned on April 4, 2014 and the existing interconnection arrangement is capable of full power evacuation but it could not meet contingency conditions as the 220 kV Uch-Sibi transmission line project was not completed. Therefore, in case of any faults in nearby systems, the power from one of the most efficient power plants cannot be optimally dispatched.

Also, two Foundation Wind Energy Limited plants in the Gharo cluster were commissioned in December 2014 and April 2015, but their power evacuation had to be curtailed due to overloading and insufficient capacity of the 132kV network. Likewise, Fauji Fertiliser’s Wind plant in the Jhimpir Cluster was commissioned in May 2013 but its power had to be cut because of overloading and insufficient capacity of the 132kV line until August 2017.

Delays in completing transmission projects not only impact the operational performance of the system, but may also lead to additional costs, which are then required to be passed on to the consumer. The regulator said the “NTDC paid approximately Rs5 billion because of cost over-runs for some of these projects”.

Also, certain projects specifically in Khyber Pakhtunkhwa, were bound to be delayed in view of their physical progress and the scheduled completion dates. Naturally, that did not support the federal government’s objectives of providing adequate supply of electricity and increasing energy sales, which is critical to lowering overall tariffs for the end-consumer.

In addition to cost over-runs, soft costs also balloon up in the shape of commitment charges that must be paid to lenders. “The NTDC was required to pay around another Rs5bn as additional commitment charges for about 16 transmission line projects. The benefits of otherwise soft loans were wasted because of bad management and poor governance.”

Nepra said that the gap between the generation capability of the power plants — connected with the NTDC system — and installed capacities will widen overtime. Currently, it is at 908MW but it will expand to about 14,000MW by 2025, as various factors — like auxiliary consumption, impact of site reference conditions and seasonality effects on renewables — come into play.

The regulator argued that it is imperative to optimally use the new generation capacity that is introduced in the system. Transmission and distribution infrastructure must be able to handle all available electricity and deliver it to the end-consumer. Nepra also added, that “networks in NTDC and in most of the DISCOs are not adequate to transmit electricity under different system conditions”.

Published in Dawn, August 11th, 2018