ISLAMABAD: The federal government has decided to drop the financing of 39 power projects and construction of dozens of small dams under the Public Sector Development Programme because of the financial crisis.

The decision will aggravate the power supply situation in the four provinces and deepen the electricity crisis.

According to a status report on the PSDP for 2010-11 released by the Planning Commission, the government has released Rs3.7 billion out of the allocated amount of Rs5 billion for the construction of Diamer-Bhasha dam.

In the nuclear energy sector, the entire allocated amount of Rs3.58 billion has been released for units three and four of the Chashma nuclear power plant. However, a nuclear power waste facility remained without funding.

The proposed Porali dam, Naulong storage dam and Pelar dam in Balochistan will get no financing. Under the Balochistan package of 100 small dams, the construction of 25 dams has been dropped.

Nai Gaj dam in Dadu, Bara dam in Khyber Agency, Kurram Tangi dam in North Waziristan, eight small and medium dams in Khyber Pakhtunkhwa, Sita dam in Qambar-Shahdadkot, Kot Fateh Khan dam in Attock, Darban dam in Dera Ismail Khan and Hingol dam also faced axe in the development budget.

A project to import 100MW electricity from Iran for which a 220KV grid station was to be set up in Gwadar with the assistance of Iran has also been dropped. The government had allocated Rs35 million for the project.

The Neelum-Jhelum hydropower project in Azad Kashmir, which was to be initiated with foreign assistance of Rs903 million, has been dropped.

Other projects which were included in the PSDP but will not get funds include Khan-Khawar hydropower project in Shangla-Bisham, Allai Khawar hydropower project in Battagram, Dubair Khawar hydropower project in Kohistan and Keyal Khawar hydropower project in Khyber Pakhtunkhwa.

Transmission arrangements for power dispersal of Ghazi Barotha with the assistance of the ADB, IDB, Kuwait, Germany and Japan received no funds under the PSDP.

The upgradation and load dispatch system of the National Power Control Centre in Islamabad was not considered for financing, the status report said.

The second rural electrification project in Balochistan to be funded by the Kuwait Fund and the 220KV expansion project in Kassowal to be assisted by the World Bank have also been dropped.

The sixth secondary transmission grids projects of Lesco, Gepco, Mepco, Iesco and Hesco remained without funding. The phase one of power distribution enhancement projects of Lesco, Gepco, Mepco, Fesco, Iesco, Pesco, Hesco and Qesco have been dropped.