Pakistan govt denies cancelling power generation at Diamer-Bhasha Dam

Pakistan's Power Division has strongly refuted claims that the government has canceled the power-generation component of the Diamer-Bhasha Dam, labeling a report suggesting otherwise as "fake news."

The report, published by Brief, a reader-supported publication, cited a leaked government document from the Economic Affairs Division. It alleged that the decision was influenced by lobbying from independent power producers (IPPs) who allegedly receive substantial payments even when their plants produce little power. The report suggested that Pakistan has an overabundance of generating capacity and that the dam's 4,500-megawatt hydropower complex could be built at a later date, with the dam initially serving solely as a water reservoir.

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Diamer Bhasha Dam generation component is a committed project in both existing and future IGCEP (Indicative Generation Capacity Expansion Plan) documents.

In its rebuttal, the Power Division asserted that the Diamer Bhasha Dam's generation component is a firm commitment, included in both current and future Indicative Generation Capacity Expansion Plan (IGCEP) documents. The division further clarified that the business model for new IPPs in Pakistan has effectively ended following the establishment of a free electricity market by the current government. It dismissed any attempts to link IPPs to the Diamer-Bhasha project and sensationalize the issue as being based on unfounded assumptions.

The Power Division also addressed claims that leaked documents indicated a prioritization of water storage over power generation due to factors like rapid rooftop solar growth, declining demand, substantial excess electricity generation, and financing uncertainties. The report suggested that spending on additional water storage would be more pragmatic than building the power component, and that civil works for future power generation should be incorporated. The Power Division stated that any attempt to link IPPs with this project and sensationalize it is based on nothing but fake assumptions.

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Any attempt to link IPPs with this project and sensationalise it is based on nothing but fake assumptions.