KARACHI: Implementing the Gas Allocation Policy will save more than Rs99 billion
of the government stated by Rehan Javed, Print Paper Mills Association in the media meet on Monday held at local Club of Karachi.
He said that the Govt should provide cheaper electricity which can be obtained by power generation units by means of local gas instead of expensive RLNG.
Sui Southern Gas Company is not implementing the preferential policy of gas usage as approved by the government and cabinet decision while there is also the violation of Article 158 by which government is bound to provide the gas first to that province where it has beenexplored.
Former President, Federal B Area Association of Trade and industry, Haroon Shamsi laminated the light on Gas allocation policy which revised in the year 2018, power generation units has been declared as the second priority.
The third priority of the SSGC Gas Allocation Policy is to provide the gas to Captive Power Plants but if natural gas is supply to power generation plants that will produce cheap electricity in the best interest of the public.
The captive power units are generating electricity at Rs 14 per unit by using natural gas (local), while electricity is available to the citizens of Karachi at more than Rs 48 per unit because Captive Power Plants are not subject to any sales tax, electric duty, PHL, fuel
charges adjustment or capacity charges.
Engineer Abubakar, representative of Large Steel Manufacturer Association said that between April 2022 and March 2023, the electricity consumers of Karachi have to pay an additional 184 billion rupees in the form of tariff differential.
According to the decision of the Cabinet in 2018, 135 MMSFD gas was supplied to K Electric, then the subsidy would have decreased by 84 billion rupees.
The supply of local gas for power generation will not only save the national exchequer Rs.99 billion but also save the foreign exchange which was spent on RLNG.
The efficiency of the Captive Power Units is much lower than that of BPQS II and BPQS III installed in K-Electric’s city.
Kapito Power uses 0.36 cubic meters of gas to generate one unit of electricity. While Haveli Bahadur Shah, Baloki and BPQS III generate the same electricity in 0.13 to 0.10 cubic meters of gas.
The industries operating on 749 captive power units established in Sindh should be transferred to the national grid, while the remaining gas should be diverted to more efficient power plants.
Transferring local gas to Baluki Haveli Bahadur Shah, BPQS III will save enough resources of the national exchequer.
About 1300 MW of electricity is generated from Captive Power Units, transferring this electricity to the national grid will save the government billions of rupees. Captive power Plants of Sindh will have similar policy like Punjab, should be adopted and RLNG should be given to them at 13 dollars per MMBtu, by which they will enable to produce electricity at 28 rupees per unit.
Government also pays capacity charges to IPPs as these Independent Power Producing plants are not on the national grid.