ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet will convene on Thursday (Dec 19) to approve the security package documents for the 7.08 MW Riali-II Hydropower Project, developed under the Power Generation Policy 2015, sources told Business Recorder.
Key Considerations
The Finance Division has directed the Power Division to ensure that the proposed agreements strictly adhere to the Power Generation Policy 2015, especially regarding contractual terms, and avoid imposing any additional obligations or guarantees not already specified in the policy. The division also clarified that Water Use Charges (WUC) for Azad Jammu and Kashmir (AJ&K) must be included in Independent Power Producers’ (IPPs) tariffs, with no financial liability for the Government of Pakistan.
Project Updates
The Private Power and Infrastructure Board (PPIB) recently extended the Financial Closing Date for the Riali-II Hydropower Project by 18 months—from April 13, 2024, to October 12, 2025. Located on Ghori Nullah in AJ&K, the run-of-river project has faced multiple delays due to the absence of ECC-approved security documents, including the Implementation Agreement (IA), Energy Purchase Agreement (EPA), and Water Use Agreement (WUA).
Background
The Tripartite Letter of Support (TLOS) for the project has already received three 12-month extensions since 2021. Under the third extension, approved on November 10, 2023, the project company was required to finalize agreements before financial close. To expedite this, the project team sought early approval of agreements from the Special Investment Facilitation Council (SIFC) and the Cabinet Committee on Energy (CCoE)/ECC.
The ECC’s decision will mark a critical step forward for the long-delayed small hydropower project.
Story by Mushtaq Ghumman
