ISLAMABAD - Prime Minister Muhammad Nawaz Sharif is scheduled to inaugurate Pakistan's first private hydropower IPP in Mirpur, AJK, today (Monday). The 84MW run-of-the-river New Bong Escape Hydropower Project would replace approximately 135,000 tons of oil import valued in excess of US$ 100 million per annum.

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Laraib's New Bong Escape Hydropower Project will contribute 540 GWh of green energy annually into the national grid under a 25-year PPA with NTDC. This project will provide cheaper electricity and energy security to the country.

Laraib Energy Ltd is a subsidiary of Hub Power Company (Hubco). Hubco is now also poised to be the first IPP to convert its power station to coal to provide even cheaper energy than at present and save hundreds of millions of dollars being spent on oil imports every year.

One of the biggest issues of power sector in Pakistan is the expensive power generation, and the inauguration of country's first private sector hydro IPP by Laraib has paved the way for private sector investment in hydropower projects for producing cheap electricity.

The project was scheduled to be completed in 42 months, itself a demanding target, but has been completed over two months earlier; comparing three similar low-head hydropower projects on the Ohio River, USA totaling 191MW started one year before NBE Hydropower Project but still have one year to commercial operations. The New Bong Escape Hydropower Project has the distinction of being Pakistan's first hydropower project to be registered with the United Nations' Framework Convention on Climate Change as clean mechanism development (CDM) Project, and has made solid contribution in offsetting green house emission globally.

The Asian Development Bank and other lending banks, multilateral IDB, IFC and Proparco France and two domestic commercial banks NBP and HBL, played a very pro-active and constructive role in structuring the project and finance documents thus making this pioneering project a reality.

The successful completion of Pakistan's first independent hydropower project by a private investor, in record time, has given hope for harnessing the vast potential of the country's water sector. As per official estimates, Pakistan has 100,000 MW of hydel power generation. However, only about 6,500 MW of potential has been harnessed so far.