NCPL Principle Agreements
Implementation Agreement (IA)
Power Purchase Agreement (PPA)
The Implementation Agreement (IA) was signed between the Islamic Republic of Pakistan ("GOP") and Nishat Chunian Power Limited on September 15, 2007. The GOP, through the Private Power and Infrastructure Board, issued to NCPL a Letter of Support dated July 6, 2007 to design, insure, finance, acquire, construct, install, complete and commission the complex and to own, operate and maintain the complex in accordance with all the applicable laws and terms of IA. This agreement acts as a sovereign guarantee for the debt & equity investors of the project and guarantees the obligations of WAPDA under the PPA (Power Purchase Agreement), and SBP under the Foreign Exchange Risk Insurance Scheme.
As per the Power Purchase Agreement ("PPA"), the National Transmission & Dispatch Company Limited (NTDCL) has contracted to purchase a total net generation capacity of 195.722MW produced by NCPL for a period of 25 years at levelized payment per KWh indexed to various foreign and local inflation indexes and devaluation of Pakistani Rupee to US Dollar on quarterly basis. Energy payments are required to be made on the basis of electricity supplied whereas Capacity payments are to be made on the basis of availability of the plant. The company is required to maintain annual availability of up to 88%. The power purchaser has also agreed to reimburse the company certain pass through items. NTDCL is sole buyer of power generated by NCPL. Under the Power Policy 2002, the company is guaranteed a US dollar equity Investor Rate of Return ("IRR") of approximately 15%. Pakistan's IPPs have a unique return structure for tariff in which they are insulated from fluctuations in fuel prices, interest rates and foreign exchange rates. The tariff structure outlined in PPA ensures IPPs of US dollar-denominated revenue streams, with both capacity and energy charges pegged to the US dollar thus insulating cash flows from exchange rate movements.
Operation & Maintenance Agreement (O&M)
| NEPRA Approved Reference Tariff
|Total Tariff Payment
||11.1627 Rs. /KWh
|Energy Purchase Price
||9.0513 Rs. /KWh
|Capacity Purchase Price
||2.1114 Rs. /KWh
The Operation and Maintenance Agreement has been signed between Nishat Chunian Power Limited and Wartsila Pakistan (private) Limited on July 24, 2009 for a period of five years after commercial operations.