K-Electric Limited (KEL) has proposed a groundbreaking 200 MWp renewable hybrid power project. This initiative, combining wind and solar energy, is set to be developed at the Dhabeji Grid in Karachi.

K-Electric proposed a competitive benchmark tariff of US Cents 5.1313/kWh, coupled with a request for USD indexation on the entire tariff to counter the surge in country risk premiums. This strategic move is expected to pique the interest of potential bidders, leading to more competitive tariff bids.

Furthering its commitment to renewable energy, KEL also sought permission from the National Electric Power Regulatory Authority (NEPRA) for open competitive bidding, advocating for the same concessions and incentives currently extended to upcoming federal solar projects.

The Authority has given its nod to this request, recognizing the need to stimulate investor interest and expedite the project’s implementation.

KEL’s vision extends beyond immediate needs, planning to integrate a mix of base load and renewable sources to meet future demand patterns. The company aims to initially incorporate approximately 150 MW of wind power, with plans to expand following the completion of the ongoing Variable Renewable Integration study.

The hybrid model promises enhanced management of wind intermittency and a stable power output. KEL anticipates significant cost savings in land utilization, estimating a reduction of about 10% by installing solar panels between wind turbines. This arrangement is also projected to yield a 32% cost saving in the Electrical Balance of the Plant due to optimized infrastructure.

Overall, KEL’s innovative approach is expected to result in a 5-6% tariff reduction, translating to a substantial USD 45 million savings over the project’s lifespan.

The Authority has granted KEL the green light to conduct open competitive bidding without a benchmark tariff, acknowledging the project’s potential synergies. Additionally, KEL is permitted to hold a non-controlling equity share of up to 25% in the Special Purpose Vehicle (SPV), with the successful bidder having the final say in KEL’s participation.

This hybrid project stands as a testament to KEL’s commitment to sustainable energy solutions and its proactive response to the nation’s economic challenges.

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