Sindh solicits bid for 45MW private power plant which will supply electricity to Dhabeji water plants

Irshad Salim –The Karachi Water and Sewerage Board (KWSB) has shortlisted local power project developers for competitive bidding on a dual fuel-fired (oil & gas) power plant.

The build-operate-own-and-transfer (BOOT) 45MW plant will supply electricity to the 100MGD Water Pump Station and Treatment Plant at Dhabeji near the suburbs of Karachi.

The privately-operated plant with KWSB as its client and power purchaser is being planned for completion within 18 to 24 months so it can provide uninterrupted power supply to the critical water supply system for the country’s financial capital and Sindh province’s capital.

The successful bidder will operate the plant for 25 to 30 years and supply electricity to Dhabeji water system at a rate expected to be lower than K-Electric’s present rate of Rs20/KwH, it has emerged.

Karachi’s pattern of slow nightlights growth, or even dimming at the core, accompanied by rapid growth in peripheral areas between 1999 and 2010. [Source: World Bank].

The PPP-led government in Pakistan’s southern province along the Arabian Sea shoreline called for the competitive public bid solicitation under federal and provincial rules after an unsolicited techno-commercial proposal was received by KWSB a few months back from a well-known Karachi-based outfit called Technomen Kinetics.

Related article: Karachi needs more than $10b capital investment to close infrastructure gaps in the city: Report

This is for the first time such an initiative in power sector in the country’s economic capital is being undertaken. If successful, the model could spur more such private investments in the metropolis, experts said.

In a related note, the local government-led Karachi Metropolitan Corporation (KMC) has embarked on an initiative to build power plant for the metropolis. The capacity of the LNG-based plant being considered range from 100MW to 500MW and the order of magnitude cost ranges from $150 million to $600 million.

According to reports, a well-known American company with worldwide operations in power has shown keen interest in the KMC project and comes at a time when international and multinationals are showing keen interest in the megacity as it’s located few hundred miles east of Gwadar port in Balochistan– the gateway to China Pakistan Economic Corridor which will link the region over the years and make the country center of economic gravity.

With the emerging geoeconomic scenario Karachi must step up to provide enabling environment to investors and facilitate peripheral growth to commerce, business and trade, some experts say.

However, recently the World Bank released a report which said the country’s biggest metropolis with a population of more than 20 million needs more than $10b capital investment to close infrastructure gaps in the city. All of it cannot be done by the government alone, experts say– a mix of public-private partnerships and independent private producers and operators can fill the gaps with foreign investments and technology partners.

With terror, extremism and extreme inter-party rivalries activities having substantially abated in the economic capital of the country, observers say Karachi once called the “Paris of the East” and the “City of Lights” will revitalize and provide the enabling environment for foreign direct investment, provided corruption and nepotism are checked and rule of law prevails.

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