ISLAMABAD: The National Electric Power Regulatory Authority has approved a 30-year levelised upfront tariff of Rs9.345 per unit for a 350MW coal-fired power plant to be set up at Port Qasim by Siddigsons Energy Limited (SEL).

The tariff for the first 10 years has been set at Rs10.61 per unit which will be reduced to Rs6.98 per unit for the next 20 years after completion of debt-servicing. The average levellised tariff for 30 years would work out at Rs9.345 per unit.

SEL, a subsidiary of Siddigsons Group, had filed a request for unconditional acceptance of upfront tariff for the plant which will use imported coal and will be financed locally as announced by Nepra in June last year.

Nepra has approved the request for level-lised tariff and is currently in the process of granting a generation licence to the plant, estimated to cost $600 million. The capital cost of the project has been approved at $455m that would also attract financing charges of about 3.5 per cent and Sinosure fee of 7pc. This will take the total project cost to $598m.

The upfront tariff has been determined on the basis of debt-equity ratio of 75:25. The return on equity would be permissible at 26.5pc and the plant would be required to deliver thermal efficiency of 39pc. It will be required to use supercritical coal technology.

After the approval of tariff the company will move into the project implementation phase to achieve financial close by March 31 next year.

The supercritical technology is considered efficient for coal-based power generation with lower carbon footprint than conventional thermal power plants.