Karachi, June 25, 2021 (PPI-OT): Monthly Power Generation Data – May-21: Generation up by +8%YoY; FO plants moved down in merit order list

As per latest data available on NEPRA’s website, overall power generation during the month of May-21 increased by +8%YoY to 13,010Gwh. Power production through RFO/Coal/Gas and LNG clocked in at 771/2,619/4,283Gwh up by +5.9x/+20%/+14%YoY, during May-21. Generation through Hydel dropped by 22%YoY. Generation is up by +24%MoM during May-21 compared to Apr-21.

This brings total generation for 11MFY21 to 115,862Gwh up by +7%YoY primarily led by +44%/+8%/+7%/+2%YoY incline in production through RFO/Gas and LNG/Coal/Hydel contributing 4%/32%/22%/30% of the total power generation during 11MFY21.

RFO: Power generation through RFO in May-21 leaped up by +5.9xYoY (up by 642Gwh) to 771Gwh, owing to higher generation from Narowal, Liberty, Atlas, AES Lalpir, Nishat Chunian, Pakgen and Nishat Power, cumulatively contributing 452Gwh. This brings total generation for 11MFY21 to 5,097Gwh up by +44%YoY owing to higher generation from Atlas, KAPCO Block I, Attock Gen, Lalpir, Pakgen, Atlas, Nishat Chunian and Nishat Power.

Gas: Gas/LNG based power generation increased by +14%YoY (535Gwh) to 4,283Gwh in May-21 on the back of higher generation from GENCO II (contributing 137Gwh), Haveli Saphire (up by 97Gwh) and, smaller IPPs (contributing 301Gwh). This brings total generation in 11MFY21 to 37,271Gwh up by +8%YoY led by higher generation from QATPL, Baloki, Haveli Bahadurshah and other smaller IPPs.

Coal: Coal based power generation inclined by +20%YoY (430Gwh) to 2,619Gwh during May-21 on the back of higher generation from CPHGC, Coal Fired Power Plant and Engro PowerGen Thar (up by 623Gwh) while generation from Port Qasim declined during the month of May-21. For 11MFY21 generation is up by +7%YoY to 24,958Gwh led by higher generation from CPHGC and Coal Fired Power Plant (Huaneng Shandong Ruyi Energy (Pvt) Ltd) while lower generation from Engro and Port Qasim.

Generation cost on RFO up by +47%YoY to PKR 14.3/Kwh during May-21: As per NEPRA, power cost on RFO during May-21 is up by +47%YoY (up by +19%MoM) to PKR 14.34/Kwh. However, gas price increased to PKR 7.85/Kwh up by +27%YoY while generation cost through LNG stood PKR 10.05/Kwh, up by +4%YoY or up +2%MoM.

FO and LNG plants remained relatively unchanged in merit order list during May-21: FO and RLNG plants remained mixed in merit order list as cost of generation was up +2%MoM for LNG while FO increased by +19%MoM compared to Apr-21. FO plants moved down due to -2%MoM decline in cost of generation for coal based plants. However, during Jun-21 most of the FO plants moved down the merit order list while some LNG plants also moved down merit order list compared to May-21.

Outlook: As a result increase in prices and depleting gas reserves, FO plants have moved up in the merit order list. RFO plants are likely to remain up in the merit order list as summer approaches while generation through gas is also likely to pick up as demand from domestic sector reduces post winters. Generation through coal is likely to remain strong owing to lowest cost of generation, however, recent spike in coal prices have led to rise in generation cost on coal. LNG based power generation may gain further traction from 2022 onwards as new LNG contract at lower prices comes in to effect.