Nepra Approves K-Electric’s $2 Billion Investment Plan for Grid Upgradation
The National Electric Power Regulatory Authority (Nepra) has approved K-Electric’s (KE) seven-year investment plan of Rs392.49 billion ($2 billion) for grid upgradation. This investment will be utilized to enhance transmission and distribution infrastructure, reduce losses, and integrate renewable energy into the grid.
The approval follows thorough scrutiny and evaluation by Nepra. The investment plan includes provisions for quarterly third-party audits and progress reports to ensure transparency and accountability.
Key Highlights of the Investment Plan
–
Transmission System Upgrade:
Rs238.22 billion will be allocated to upgrade the transmission system, including grid station development and transmission line expansion.–
Power Distribution Infrastructure Enhancement:
Rs136.76 billion will be used to enhance the power distribution infrastructure, including distribution growth initiatives and loss minimization measures.–
Support Projects:
Rs17.31 billion will be invested in support projects such as IT infrastructure, Enterprise Resource Planning (ERP), and property regularisation.–
Distribution Loss Reduction:
Rs43.32 billion will be allocated for the minimization of losses within the distribution network.–
Distribution Maintenance and Safety Measures:
Rs29.919 billion and Rs20.546 billion will be invested in distribution maintenance and safety measures, respectively.–
Integration of Renewable Energy:
The plan includes investments in solar power integration projects and associated transmission lines, amounting to Rs12.844 billion.Impact on Consumers
Nepra has approved Transmission and Distribution (T&D) losses for KE, which reflect a gradual reduction over the fiscal years 2023-24 to 2029-30. Distribution loss percentages will decrease from 13.46% to 11.48%, while transmission losses will remain constant at 1.30%. Any additional reduction in losses beyond the target will be shared between consumers and KE in a ratio of 75:25, respectively.
KE’s Response
KE has welcomed Nepra’s approval and emphasized the importance of timely execution of the investment plan. The company believes that a sustainable and cost-reflective tariff remains critical for the successful implementation of the plan.
The investment plan is aligned with KE’s Power Acquisition Program, which aims to achieve a 30% share of renewable energy in its generation mix by 2030. KE has also received regulatory approval for RFPs of 640MW renewable projects, further supporting its commitment to affordable and sustainable energy.
KE CEO Moonis Alvi acknowledged the efforts of all stakeholders involved in the approval process and emphasized the company’s commitment to modernizing its infrastructure and preparing for the future.
