Korean companies developing hydropower projects in Khyber Pakhtunkhwa (KPK) face significant hurdles as the Power Division withholds approvals and meeting requests. The projects, worth millions of dollars, are stalled due to non-optimization under the Indicative Generation Capacity Expansion Plan (IGCEP).
According to a news report, Wan-Seok Bae, CEO of LSG Hydro Power Limited, which has been working on a 470MW hydropower project under a public-private partnership since 2018, stated in a letter to the Power Secretary that despite meeting obligations under the 2015 Power Policy, the project’s progress is stalled. LSG HPL, a subsidiary of Korea Hydro & Nuclear Power Co., completed a bankable feasibility study in 2022 and obtained necessary NOCs from environmental and regulatory authorities. However, its tariff petition and generation license application were returned under new IGCEP regulations.
Another Korean firm, Korea-South East Power Company (KOEN), faces similar issues. In a letter to Senator Mohsin Aziz, Chairman of the Senate Standing Committee on Power, KOEN emphasised the need for Pakistan to uphold its policy commitments under the 2015 Power Policy. The company argued that Nepra’s cost comparison criteria under IGCEP are flawed and requested tariff determinations based on the original policy.
Minister for Power Sardar Awais Leghari and Nepra Chairman Waseem Mukhtar have maintained that new projects cannot be added to IGCEP as allocations for the next decade are finalized. They suggested revisiting the inclusion of Korean projects if they align with revised cost criteria under the IGCEP in the future.
Both companies have urged the government to ensure policy integrity, maintain fair treatment of investors, and foster a stable environment for foreign investment. They also called for reforms in IGCEP’s cost methodology to support viable hydropower initiatives and safeguard energy security.
