Pakistan’s Lowest Priced Operations & Maintenance Agreement Signed for 1230 MW Haveli Power Plant

Government of Pakistan-owned National Power Parks Management Company (NPPMCL) signed a 12-year Operations and Maintenance (O&M) agreement with China’s state-owned company SEPCOIII for its 1,230 MW Haveli Bahadur Shah Combined-Cycle Power Plant in Lahore on May 4th, 2017.
CEO NPPMCL Mr. Rashid Mahmood and Vice President SEPCOIII Mr. Shi Huaiwei signed the agreement having a reference value of US$ 148 million over 12 years. With this O&M agreement, NPPMCL has managed to save the consumer Rs. 0.20/kWh from the Rs. 0.52/kWh O&M costs allowed by the regulator. This fee structure is estimated to result in direct savings of at least Rs. 23 billion over 12 years.
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.

SAVINGS IN AWARD OF O&M CONTRACT
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. Rs. 23,345,890,560