Pakistan, China sign agreement for Haveli Bahadur Shah Combined-Cycle Power Plant

ISLAMABAD: Pakistan on Thursday signed a 12-year Operations and Maintenance (O&M) agreement with China for its 1,230 MW Haveli Bahadur Shah Combined-Cycle Power Plant in Lahore.

The agreement was signed between Pakistan’s state-run National Power Parks Management Company (NPPMCL) and China’s state-owned company Shandong Electric Power Construction Corporation III (SEPCOIII). The agreement has a reference value of US$ 148 million over 12 years.

With this O&M agreement, NPPMCL has managed to save the consumer Rs0.20/kWh from the Rs0.52/kWh O&M costs allowed by the regulator. This fee structure is estimated to result in direct savings of at least Rs23 billion over 12 years, said a press release.

Under the agreement, SEPCOIII shall have end-to-end responsibility for the operations and maintenance of the Haveli Power Plant for at least 12 years or its second Major Inspection (MI), whichever is later. SEPCOIII shall deploy human resource and be responsible for any repair or replacement of functional parts at the plant to maintain plant availability at 92%.

The O&M agreement includes robust liquidated damages (LD) contractual safeguards to ensure performance against guaranteed efficiency and availability values.

SEPCOIII was selected through an open and transparent bidding process that attracted bids from eight companies from around the globe.

O&M Cost allowed by NEPRA     PKR 0.52 / kWh

O&M Cost achieved for HBS        PKR 0.32 / kWh

Saving per kW   PKR 0.20 / kWh

Total saving on net output

(12 years at 92% availability factor)

1,207,000 x 24 x 365 x 12 x 0.20 x 92%

i.e. Rs23,345,890,560