ISLAMABAD - National Electric Power Regulatory Authority (NEPRA) on Monday granted upfront tariff to the China Sunec Energy Private Limited for generating 50MW electricity through its wind power project located at Jhampir District, Thatta (Sindh).

According to the decision, China Sunec Energy is allowed to charge the following tariff for its delivery of electricity to the power purchaser.

For first year, the O&M is Rs1.6040, insurance Re.7833, return on equity Rs4.6902, principal payment on debt Rs5.2331, interest Rs3.2496. This all sums up to Rs15.5602 per kilowatt-hour.

From first year to third year, the principal repayment of debt is the same. However, for fourth year, the principal repayment of debt changes to Rs6.0836, for year five it is Rs6.3967, and for year 10th the PROD changes to Rs8.2215.

According to the reference tariff, the amount of interest also changes from year first to ten and starting from Rs 3.2496 it decreases to Rs.2612 in tenth year. From year 11 to 20 the total tariff would become Rs 7.0775 per kilowatt-hour.

According to the work-sheet, the average tariff is calculated Rs.13.1998, which is, according to the document, equal to 13.5244 US cent kilowatt per hour.

According to the decision, the applicant had applied for the upfront tariff on the basis of 100 percent foreign loan and company in its application stated that its wind turbines are internationally certified.

In its decision, Nepra has clarified that power purchaser will not take the wind risk and it would be applicant’s responsibility. It also directed China Sunec to achieve financial close by March 31, 2015, otherwise the generation license would become null and void. It further says that targeted maximum construction period after financial close is 18 months and Nepra would not make any adjustments in case of any financial impact due to any delay.

The authority however says that in case of any changes in financing structure the tariff may be considered for any further changes. The company intends to carry out the project on 100 percent foreign investment/loan.