National Electric Power Regulatory Authority Islamic Republic of Pakistan

NEPRA Tower, Attaturk Avenue (East), G-511, Islamabad 468,515 Ph: +92-51-9206500, Fax: +92-51-2600026 Registrar Web: www.nepra.org.pk, E-mail: [email protected]

No. NEPRA/TRF-193/MPCL-2011/3149-3151 February 22, 2019

Subject: Decision of the Authority in the matter of Adjustments at Commercial Operation Date of Metro Power Company Ltd. (Case No. NEPRA/TRF-193/MPCL-2011)

Dear Sir,

Please find enclosed herewith the subject Decision of the Authority along with Annexure-I & II (24 pages) in Case No. NEPRA/TRF-193/MPCL-2011.

2. The Decision is being intimated to the Federal Government for the purpose of notification in the official gazette pursuant to Section 31(7) of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997.

Enclosure: As above

( Syed Safeer Hussain )2:2-ch-15

Secretary Ministry of Water & Power `A' Block, Pak Secretariat Islamabad

CC: 1. Secretary, Cabinet Division, Cabinet Secretariat, Islamabad. 2. Secretary, Ministry of Finance, Islamabad.

Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

Subject: DECISION OF THE AUTHORITY IN THE MATTER OF TARIFF ADJUSTMENTS AT COMMERCIAL OPERATION DATE OF METRO POWER COMPANY LIMITED 1. Introduction

1.1 The Authority issued the tariff determination of Metro Wind Power Company (hereinafter referred to as "MPCI,") dated May 15, 2012, wherein, the Authority determined a cost plus levelized tariff of Rs. 12.7445/kWh, US cents 14.5236/kWh against the tariff petition of MPCL.

1.2 1,ater MPCL attained its commercial operations with effect from Sep 16, 2016. As per the tariff determination, MPCL is required to file application for onetime adjustments in tariff components within 90 days of COD. MPCL through their letter dated Dec 13, 2016 requested the Authority for extension of 180 days (from the actual tariff true-up application filing deadline) for filling onetime adjustment. Later MPCL through its letter no. F-NEPRA-L17-00180 dated April 13, 2017 submitted its request for adjustment of relevant components of its tariff and also submitted documents in support, thereof.

1.3 The summary of project cost allowed to MPG, in tariff determination is as under:

Project Cost Heads US$ in millions Offshore EPC contract 88.248 Onshore EPC contract 20.594

Total EPC contact 108.842 LC opening/confirmation charges 1.045

Total EPC cost 109.887 Non EPC cost Project development cost 3.916 Duties and 0.750 Pre COD insurance 1.483 Financial charges 2.611 Interest during construction 6.589

Total Project Cost 125.236

Reference Values: Rupee-Dollar Parity Rs. 87.75/USD US CPI (All Urban Consumers) 226.889 WPI (Manufacturers) 209.470

Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

Local Financing 6 Months KIBOR plus 3.00% Foreign Financing 6 Months LIBOR plus 4.50% : Equity Ratio 75 : 25

1.4 Summary of the reference tariff as per the tariff determination is as follows:

REFERENCE TARIFF

Year Year Year Indexation Tariff Components 1 - 2 3-10 11- 20

O&M Local 0.2410 0.3088 0.2792 WPI Foreign 0.4885 1.1095 1.2038 PKR / US$ & US CPI insurance 0.6712 0.6712 0.6712 PKR / US $ Return on Equity 3.2822 3.2822 3.2822 PKR / US $ Return on Equity During 0.4102 0.4102 0.4102 PKR/ US$ Construction Withholding @ 7.5% 0.2769 0.2769 0.2769 PKR / US$ & LIBOR for Debt Service 9.4329 9.4329 foreign loan and KIBOR for local loan

1.5 MPCL submitted it COD stage tariff true-p request on April 13, 2017. The information submitted by MPCL along with its request for adjustment of tariff at commercial operations date (hereinafter referred to as "COD") was not complete. Accordingly missing information and confirmation had to be sought.

2. One Time Adjustments

2.1 EPC Contract Price

2.1.1 The Authority in the tariff determination has allowed US $108.842 million (Rs. 9,550.8855 million) on account of EPC contract with both on-shore and off-shore components. The adjustment mechanism given in the determination is reproduced below;

"... The EPC contract cost will be adjusted at COD on account of variation in US$/PKR and Euro/PKR parity, on production of authentic documentary evidences to the satisfaction of the Authority..."

A comparison of EPC cost allowed in the tariff determination and claimed by the Petitioner (MPCL,) is as follows: Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

Tariff Determination Total Claimed EPC Cost USD/ Euro/USD Equiv. USD/PKR Equiv. Descript ion Contractor Euro in USD in PKR Euro in USD in Cony. Rs. in Euro/USD Corm Rs. in M M Cony. M M rate M rate M rate Nordex Off sh ore Energy Gmbx 38.418 1.360 52.249 87.75 4,584 38.418 1.108 42.551 103.92 4,425 PC Cost Descon FZE UAE 35.999 87.75 3,158 36.081 103.44 3,737 Nordex Pakistan Private 4.640 103.90 482 Limited Descon On shore Engineering 13.204 1,349 PC Cost Limited 20.594 87.75 1,807 Descon Engineering Services 2.750 281 Technology (Pvt.) Limited

Total 108.842 87.75 9,550 99.226 103.48 10,276

2.1.2 MPCL in support of its claim submitted copies of agreements, commercial invoices, tax challans, tax deposit certificates, payments instructions, debit note, swift messages and bank statements, etc.

2.2 Off Shore EPC Cost

2.2.1 MECI, submitted that it entered into a joint turnkey agreement for procurement and supply of equipment with Nordex Singapore Equipment Private Limited (Contractor-I) and DESCON Engineering FZE, [JAE (Contractor-II) on Sep 08, 2011. The scope of offshore contracts is as under:

Contractor Contractor-1 Nordex being the lead contractor shall be responsible for the overall management, coordination and implementation of the Project outside the country.

Contractor-II Descon to provide the Project with local expertise for performance of works and achieve completion of the facility with an aim to mitigate the risks associated 2.2.2 During the review certain contradictory and inadequate documentary evidence were observed. They were accordingly referred to the financial advisor of MPCL who were coordinating the review and later to MPCL.

2.2.3 The unusual matters observed broadly include:

Original Contracts were not available.

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Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-201l

ii. Port of shipment from China was observed which was contradictory to tariff petition. iii. Novation signed by official not authorized. iv. Novation Deeds signed for both EPC onshore and EPC offshore but payment made to those parties prior to Novation. v. Payments made to different bank accounts against same EPC contract. vi. Novation Deeds signed by same official from both sides.

2.2.4 In response it was submitted that original contracts and novation deeds are not available in Pakistan. It was also submitted that these novation deeds have been approved by the lenders to the Project.

2.2.5 Accordingly the Authority decided to seek third party verification to have reliable level of assurance on the cost to be allowed. The confirmation letters were issued to:

i. National Bank of Pakistan (N1313) — Banker to MPCL ii. International Finance (MC) — Financier/Lender iii. Eco and Development Bank (ETDB) - Financier/Lender iv. State Bank of Pakistan (S131)) v. Moreover, MPCL was also issued a letter to clarify and also address the unanswered queries.

2.2.6 Information was also sought from Nordex Pakistan Pvt. Ltd. vide email dated March 27, 2018 seeking confirmation and information regarding certain payments under novation of FTC contracts. In response to information, Nordex Pakistan Pvt. Ltd. submitted the following documents.

a. Nordex Singapore Equipment — Certificate of Incorporation b. Nordex Singapore Equipment - MOA c. Nordex Singapore Equipment — Extract from Article d. Nordex Singapore Equipment — Extract from Shareholding e. Nordex Singapore Service -- Certificate of Incorporation f. Nordex Singapore Service MOA g. Nordex Singapore Service Extract from Article h. Nordex Singapore Service Extract from Shareholding i. Nordex Pakistan — Extract from Shareholding

2.2.7 Later a confirmation letter dated April 05, 2018 was submitted by the parent company Nordex SE confirming full authorization of Nordex SE regarding the Novation Deeds and also confirmed that Mr. Willem I.ansink had full legal capacity to enter and execute the Novation deeds.

2.2.8 Subsequently the Authority observed that:

i. MPCL again failed to present the original agreements.

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Decision in the matter of Metro Power Company Limited iz.nepidk tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-20l1

ii. MPCL has earlier submitted that the Novation agreements have been duly reviewed and approved by lenders of the Project. Whereas response by IFC did not respond to query and instead responded that "Novation Agreements were executed on September 24, 2014".

iii. Likewise NBP despite of reminder failed to provide the particulars and names of the directors of Nordex Singapore Equipment Pvt. Ltd and Nordex Singapore Services Pvt. Ltd despite the fact that the bank accounts of both these organizations were opened and maintained by NBP.

iv. Also State Bank of Pakistan (SBP) against reminder from NEPRA responded on January 3, 2019 stating that "In this regard, it is informed that we have taken up the subject matter with National Bank of Pakistan and their complete response is still awaited. The same will be shared with NEPRA in due course': Subsequently no response has been received.

2.2.9 In view of above, MPCL (and related third parties) failed to respond to certain queries raised by NEPRA with authenticated justification and evidence to provide required level of assurance. Accordingly the Authority on Oct 03, 2018 decided to engage an independent auditor for verification of its project cost in view of the developed ToRs.

2.2.10 A review motion was filed by MPCL against the above said decision and requested an opportunity of being heard. Accordingly review motion request was admitted and hearing was conducted on Dec 26, 2018.

2.2.11 During the hearing held on Dec 26, 2018 the petitioner requested authority to re-consider and withdraw its decision to carry out independent audit under the ToRs specified and give its final decision. They also expressed that delay has caused financial constraints, causing concern for lenders of the project also. They also submitted that relevant information has been provided. They also submitted that it is beyond an Audit firm's expertise to verify the matters specified in ToRs for audit.

2.2.12 A decision in pursuance to the said hearing was given by the Authority and the Authority decided to withdraw its earlier decision regarding audit of project cost of MPCL subject to

a. Deduction of the unverified amount in the EPC Component b. Submission of EPC Contracts and Novation Deeds duly verified and endorsed by the Company and relevant public Legal Institution

2.2.13 Later MPCL vide their letter dated January 18, 2019 submitted copies of EPC Contracts and their Novation Deeds notarized by Notary Public Advocate Aijaz Ali (Karachi). These were reviewed by NEPRA's legal officials and found acceptable as legally authentic for the purposes of processing the case.

2.2.14 "lhe Authority observed that against the claimed € 38.418 million, € 1.921 million has been paid after COD whereas the adjustments is to be made at COD. Therefore exchange rate prevailing at COD date to he applied to this subsequent payment.

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Decision in the matter of Metro Power Company Limited 1,11Ppid?e tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.2.15 The petitioner at COD claimed US$ 36.018 million for the offshore contractor II as against the determined cost which was based on the agreement price of US$ 35.999 million. The petitioner submitted that the additional claim of US$ 0.082 million is for the change order. The Authority therefore decided to restrict the amount to the determined contract value. US$ 2.401 million are paid after COD whereas the adjustments are to be made at COD, therefore exchange rate prevailing at COD date has been used.

2.2.16 Moreover, considering the limited trail and corporate evidence for amounts transferred to their bank account at NBP Frankfurt Branch (i.e Euro 576,274 or PKR 81,239,571 including related bank charges and FED) were not approved by the Authority in the Project.

Date Reference Transaction S.No Beneficiary Name Beneficiary A/C — IRAN Beneficiary Bank Transaction Amount Nordex Singapore National Bank of 89 9000 05 FTT/1862/ FUR 07 Oct. 13 Equipment (Pvt.) Pakistan, Frankfurt, DE94 5013 0000 0089 9000 05 115/13 384.182.97 Ltd. Germany Nordex Singapore National Bank of 89 9000 05 FFT/1862/ RJR 16 June. 14 Equipment (Pvt.) Pakistan, Frankfurt, DE94 5013 0000 0089 9000 05 057/14 192,091.49 Ltd. Germany

2.2.17 In view of above, the Authority decided to allow the verified amount of US$ 77.694 Million (Rs. 8,060.63 million) accordingly.

Allowed Off-shore Contractor Contractor Euro in M Equiv. US $ in M Equiv. PKR in M

Contractor-1 Nordex Energy Gmbx 38.418 41.695 4334.61 Contractor 11 Descon FZE UAE 35.999 3726.02 Total 77.694 8060.63

2.3 Onshore EPC Cost

2.3.1 As per the documents submitted, MPCL also entered into a joint agreement for Engineering, Construction, Operations and Maintenance with Nordex Singapore Services Private Limited (Contractor-1), DESCON Engineering Limited (Contractor-II) & DESCON Integrated Projects (Private) Limited (Contractor-II) on Sep 08, 2011. The scope of the contract is as under:

Contractor Scope Contractor-I Nordex being the lead contractor shall be responsible for the overall management, coordination and implementation of the Project within the country. Contractor-II a Descon to provide the Project with local expertise Contractor-II b for performance of works and achieve completion of the facility with an aim to mitigate the risks associated Decision in the matter of Metro Power Company Limited nepid tariff adjustments at commercial operation date (COD) Case No. NEPAA/TRF-193/MPCL-2011

2.3.2 The petitioner in its tariff petition dated September, 2011 had stated that with an objective of bringing a world class and bankable turn-key EPC solution under full responsibility for the complete scope of work, a consortium of Nordex and Descon under a joint arrangement was selected. The petition had also stated that Descon was selected being a reputable heavy engineering and construction contractors in Pakistan.

2.3.3 During review it was noted, Novation took place for the off-shore and on-shore EPC agreement in which Nordex Pakistan Pvt. Ltd. took place of Nordex Singapore Services Pvt. Ltd. for EPC on-shore contractor. It was submitted by MPCL that Nordex Pakistan Pvt. Ltd. was not incorporated as a company at the time of selection of EPC arrangement, however later in 2012 Nordex Pakistan Private Limited was established as a corporate entity for Novations to be executed. Thus the on-shore contract with an off-shore company was novated with an on-shore company.

2.3.4 At the COD stage the onshore contractor I was claimed as US$ 4.640 million as approved in the tariff determination. Whereas, the petitioner at COD has claimed US$ 13.204 million for the onshore contractor II as against the determined cost based on the agreement price of US$ 13.209 million. The petitioner submitted that the additional claim is for the change order of US$ 0.005 million.

2.3.5 Based on the documentary evidence submitted and verified below the Authority decided to approve and restrict the non-EPC amount to the determined value of US$ 20.594 million as summarized below:

Agreement Price Paid & Verified Onshore Contrator Contractor US$ in M Equiv. US $ in M Equiv. PKR in M

Contractor-I Nordex Pakistan Private Limited 4.640 4.640 482.008 Contractor-I1 a Descon Engineering Limited 13.204 13.204 1349.994 Descon Engineering Services Contractor-II b 2.750 2.750 281.172 Technology (Pvt.) Limited 'Total 20.594 20.594 2113.174

2.4 Letter of Credit Charges:

2.4.1 The Authority in its tariff determination has allowed US $ 1.045 million for LC charges. The Authority further decided as under;

"Confirmation charges for the letter of credit to be opened in favor of the EPC Contractor will be adjusted at COD on actual basis, not exceeding the maximum ceiling of US $ 1.045 million, upon production of verifiable documentary evidence to the satisfaction of the Authority."

2.4.2 MPCL in its COD adjustment request has not claimed any amount under LC charges and has submitted that it did not open any Letter of Credit. Accordingly no amount therefore is considered by the Authority to be allowed in project cost in this regard as part of COD tariff adjustment. .■ Decision in the matter of Metro Power Company Limited (1811f d tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.5 Duties & Taxes

2.5.1 In the tariff determination, while allowing duties and taxes of US $ 0.750 million for this project it was referred:

"Adjustment of duties and taxes on actual at COD stage, will be allowed for only those duties and taxes which are imposed on the petitioner. Adjustment of taxes/duties payable on fees/charges, etc. of various third parties, not directly imposed on the petitioner, will not be allowed"

2.5.2 It was also referred in tariff determination that:

`Duties and/or taxes, not being of refundable nature, imposed on the petitioner upto the commencement of its commercial operations will be subject to adjustment at actual on COD, as against US $ 0.750 million allowed now, upon production of verifiable documentary evidence to the satisfaction of the Authority."

2.5.3 MPCL has claimed duties and taxes of US$ 1.035 M (Rs. 107.751 million) at the COD stage and has provided following break-up of its claim:

S.No Description Rs. in M US$ in M i. Sindh Infrastructure Development Surcharge (SIDS) 85.948 0.822 ii. Federal Insurance Fee(FIF) 0.872 0.008 iii. Federal (FED) 19.184 0.188 iv. 1.647 0.016 v. Professional tax on paid up capital 0.100 0.001 Total 107.751 1.035

2.5.4 Sindh Infrastructure Development Surcharge (SIDS):

2.5.4.1 MPCI, in its COD tariff adjustment request has claimed Rs. 85.948 million as Sindh Infrastructure Development Surcharge (SIDS). As per the source documents submitted, varied rate of 0.90% to 1.05% was charged in accordance with Sindh Board of Revenue's notification for application of SIDS. In support of its claim MPCL submitted copies of goods declarations of Pakistan , payment challans of SIDS, copies of bills of entries, EPC import invoices, and hank statement etc.

2.5.4.2 Based on the source documents submitted, Authority decided to allow the claimed Rs. 85.948 million incurred on account of Sindh Infrastructure Development Surcharge (SIDS).

2.5.5 Federal Insurance Fee (FIF);

MI30. has claimed federal insurance fees (FIF) of Rs. 0.872 million (US$ 0.008 million) as a part of duties and taxes. It submitted that FIF is charged by the insurance company Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

under Finance Act 1989 @ of 1% of gross premium in the invoice. The Authority consistent to earlier decision decided to approve the federal insurance fees (FIF) of Rs. 0.872 million claimed, but to be allowed under the relevant head of Insurance cost against the limit allowed.

2.5.6 Federal Excise Duty (FED):

2.6.6.1 MPCL in its COD tariff adjustment request has claimed FED of Rs. 19.184 million incurred on the bank charges on different payments and remittances. MPCL in support of its claim has submitted the copy of bank statements.

2.6.6.2 Consistent to the earlier decisions, the Authority decided not to consider the amount of FED to be included in the project cost for instant COD tariff adjustment due to the fact that FED is adjustable in nature.

2.5.7 Stamp Duty;

MPCI, in its COD tariff adjustment request has claimed stamp duty of Rs. 1.647 million (US$ 0.016 million) consists of US$ 0.005 million (Rs. 0.566 million) paid on insurance invoices, US$ 0.006 million (Rs. 0.550 million) paid on issuance of shares and the remaining amount consists of purchase of stamp paper for the different contracts entered. Being un-adjustable duty the Authority decided to allow the claimed stamp duties of US$ Rs. 1.647 million accordingly.

2.5.8 Professional Tax

2.6.8.1 MPCI. in its COD tariff adjustment request has claimed professional tax of Rs. 0.100 million pertaining to the FY 2008 to 2013 paid in favor of Excise & Taxation officer. It was also submitted that professional tax is levied under the Sindh Finance Act, 1964 and collected on/from the persons or class of persons engaged in a profession, trade, calling or employment. In case of Companies registered under Companies Ordinance, 1984 with paid up capital limiting from PKR 5 million to PKR 200 million, the amount of tax is paid per annum as per applicable rate.

2.6.8.2 The verification of documents as provided by MPCI, revealed that claimed professional tax paid is a corporate nature of tax and also paid beyond construction period so cannot he allowed towards project cost or capitalization.

2.6.8.3 In view of above matters, below is the summary of total approved duties and taxes;

S.No Description Rs. in M i. Sindh Infrastructure Development Surcharge 85.948 Stamp Duty 1.647 Total 87.595 Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.6 COD and Construction Period

2.6.1 The tariff determination with regard to the construction period at COD provides as follows;

"The petitioner will be allowed adjustments at the COD for maximum project construction period of 18 months starting from the construction start date stipulated M the EPA."

2.6.2 The Construction start date has been defined in EPA as follows:

"The date of issuance of the 'notice to commence" by the seller to the EPC Contractor and the release by the seller to the EPC Contractor of funds equaling in aggregate at least seven percent (7%) of the EPC Cost".

2.6.3 As per the source documents submitted, MPCL issued notices to commence to EPC contractors on Oct 22, 2014. Moreover, the payments made to the contractor on Mar 26, 2015 exceeded 7% of allowed EPC cost.

2.6.4 MPCL in support of its claim has submitted CPPA(G)'s Ltd notification of COD attainment issued vide letter no. CPPA/GM/CR-11/MT-IV/MPCL/5889-908 dated Sep 29, 2016 which confirmed actual COD attained on Sep 16, 2016. This implies a construction period of 17 months 20 days. The Authority observed this is within the approved time line allowed for construction for their wind power project.

2.6.5 In view of above, summary of the project milestones is as under:

Sr. Date / Particulars -, No Period in months i . Date of tariff determination of the Authority May 15, 2012 ii. Date of power purchase agreement Feb 16, 2014 iii. Date of financial close Feb 20, 2015 iv. Construction period as per determination 18 Months v. Notice to proceed issued to EPC Contractor Oct 22, 2014 vi. 7% payment to EPC contractor Mar 26, 2015 vii. Date of required COD as per determination Sep 26, 2016 viii. Date of actual COD Sep 16, 2016 ix. Construction Period Mar 26, 2015 to Sep 16, 2016

2.6.6 Accordingly, the Authority decided the construction period from Mar 26, 2015 to actual COD Sep 16, 2016 (17 months and 20 days) to be allowed for computation of (a) interest during construction, (b) insurance during construction, and (c) return on equity during construction. Decision in the matter of Metro Power Company Limited era ~4 tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.7 Interest During_Construction (IDC):

2.7.1 In the reference tariff determination, MPCI. was allowed interest during construction (hereinafter referred to as "IDC") of US $ 6.589 million (Rs. 578.18 million) for the determined construction period of 18 months. As per paragraph 15(I)(e) of the tariff determination:

"(e) Interest during construction will be adjusted at COD on the basis of actual debt drawdowns (within the overall debt allowed by the Authority at COD), actual PKR/US$ exchange rate variation for foreign loan denominated in US $ and actual interest rates not exceeding the limit of 6 months KIBOR plus 3% for local financing and 6 months LIBOR plus 4.50% for foreign financing, during the project construction period allowed by the Authority. The allowed spread of 4.50% on foreign financing is inclusive of cost of ADB REDSIP facility."

2.7.2 Also the tariff determination for this project stated the following about financing structure:

"The Authority in view of circumstances of the case has decided as follows:

• To determine tariff of the petitioner on the basis of available record;

• To apply the financing structure as claimed in the petition for tariff determination; and The petitioner to finalize its financing structure and file a request, if required, for seeking adjustment in its generation tariff necessitated by change in its financing structure, within a maximum period of six months from the date of this determination, failing which the right of the petitioner to avail this adjustment mechanism will lapse. Due to subsequent change in financing structure of the petitioner, the tariff and relevant adjustment/indexation mechanisms specified in this determination may be revised on production of authentic documentary evidence of financing structure to the satisfaction of the Authority."

2.7.3 In view of the above the reference of 75:25 debt : equity contribution was allowed to MPCI, vide its tariff determination and any change to the reference was subject to a request to be filed by the petitioner within six months after the award of the tariff. Where MPCL belatedly vide its COD request claimed 72:28 debt:equity contribution, however as the request was not submitted within the stipulated time (i.e 6 months after the award of tariff). Consequently the capital structure of 75:25 debt : equity is based for computation at COD stage tariff determination.

2.7.4 MPCL in its COD tariff adjustment request submitted that it has availed two financing facilities (local and foreign) from two financial lenders. A cumulative USD 84.55 million loan has been acquired by 1\4PCI, for its Project representing 72% of the claimed project cost. Out of this total amount foreign loan amount of USD 38.56 million was acquired from International Finance Corporation on the interest rate of LIBOR +- 5% representing 45.6% of the total debt. Similarly Local Loan amount of USD 46 million was acquired Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

from National Bank of Pakistan on the interest rate of KIBOR + 3% and representing 54.4% of the total debt.

2.7.5 Foreign Finandng

2.7.5.1 MPCL in its COD adjustment requested to allow actual IDC of US$ 7.042 million (Rs. 735.730 million) paid till actual COD and submitted that the actual spread on foreign financing is 5% be allowed. MPCI. submitted that owing to less stable economic conditions prevailing in Pakistan, at the time of securing foreign financing for the project, no foreign financier was providing financing to Pakistani based project below 5.5% spread over LIBOR, however, after extensive negotiations, the Company was able to bring spread down to 5%. Therefore the company may be allowed the actual spread of 5% over LIBOR.

2.7.5.2 In support of its claim MPCL has submitted copy of financial agreement, copies of bank statements reflecting actual drawdowns of debt along with bank debit advices evidencing the amount of interest charged by the lenders, etc.

2.7.5.3 MPCI. submitted that it has entered into a loan agreement with IFC for an amount of US$ 45 million. As per the "Loan Agreement" loan was equally divided among Loan A and Loan 13. The financial terms agreed between IFC and MPCI., for both Loan A and Loan B are same with spread of 5% over 1.1130R.

2.7.5.4 M PCT. submitted it has actually drawn US$ 38.556 million on which the claimed IDC is US$ 2.2738 million on foreign financing calculated on the basis of 6 months LIBOR plus spread of 5% as against the allowed spread of 4.5% for the allowed construction period of 18 months. 'Me Authority while allowing the IDC for foreign financing decided to restrict it up to the spread of 4.5% over six months LIBOR consistent to tariff determination.

Description Allowed LIBOR+4.5% US $ in M Rs. in M IDC on Tranche A 1.141 119.622 1" Repayment IDC on Tranche B 0.966 101.275 1" Repayment *13ank Charges (0.0001) (0.014) *FED (0.00002) (0.002) Total IDC 2.107 220.881 The bank charges and FED adjusted in IDC has been claimed by the petitioner in financing cost head and duties and taxes head respectively and has been discussed in the relevant cost head.

2.7.6 Local Financing

2.7.6.1. MPCL submitted that it entered into a Syndicated Commercial Facility Agreement with National Bank of Pakistan who has been the commercial facility agent. Decision in the matter of Metro Power Company Limited flellfta;;.! tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.7.6.2. MPCL in its claim submitted that it has actually drawn Rs. 4,762.058 million from local finance facility on which the claimed 1DC is Rs. 495.195 million, calculated on the basis of 6 months KIBOR plus spread of 3% for the allowed construction period of 18 months. The Authority while allowing the IDC for local financing decided to allow and restrict it for construction period up to the spread of 3% over six months KIBOR consistent to tariff determination.

Description Approved Rs. in M US$ in M

Interest during construction (1,ocal) 496.236 4.760 1" Repayment *Bank Charges (0.007) (0.0001) Net IDC 496.229 4.760

2.7.7 In view of above, the total IDC approved by the Authority for the allowed construction period on both local and foreign debt works out to US$ 6.876 million (Rs. 717.102 million) on actual debt of US$ 84.555 million.

2.8 Financial charges

2.8.1 The Authority had allowed US$ 2.611 million as financial charges in the tariff determination with the confines and adjustment mechanism given as under:

Tinancial charges will be adjusted at COD on the basis of actual expense, up to a maximum of 3% of the total debt allowed (excluding the impact of interest during construction and financial charges), on production of authentic documentary evidence to the satisfaction of the Authority."

2.8.2 The petitioner in its COD tariff adjustment request claimed US$ 4.678 million (Rs.473.306 million) on account of Financial Charges. In support of its claim, the petitioner has provided photocopies of term facility agreements, bank advices, banks statements, invoices from lenders' advisors, details, computations, etc. The claimed financial charges are 6.21% of the assessed debt (excluding the impact of financial charges and interest during construction)

2.8.3 The Petitioner also claimed management and commitment fee paid to the Eco Trade Development Bank (ETDB) and arrangement fee paid to BMA capital, which are not the financier to the Project. It was also submitted that due to sanctions Eco Trade development Bank which is partly owned by the Government of Iran, the Company had to get approvals through Office of Foreign Assets Control (OFAC) for the Eco Trade and Development Bank's (ETDB) payments.

2.8.4 The Petitioner submitted that due to the unstable economic environment in Pakistan, the project faced difficulty in obtaining foreign financing for funding the project. It almost Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

took 2.5 years to secure and finalize financing agreements with international Finance Corporation (TEC).

2.8.5 The Authority deliberated on the matter and decided that financial charges are to be allowed only against the debt lending institute. Any other cost incurred has to be covered as part of non-EPC and PDC costs. Therefore the Authority decided to restrict the financial charges to 3% of assessed debt and allowed an amount of US$ 2.3375 million (Rs. 237.876 million).

2.9 Insurance during construction.

2.9.1 The Authority had allowed US $ 1.483 on account of pre COD insurance cost in its tariff determination as per the adjustment mechanism as under: "Insurance will be adjusted as per actually incurred prudent costs, subject to maximum limit of 1.35% of the approved EPC cost, on production of authentic documentary evidence at the time of COD."

2.9.2 MPCL at COD stage tariff has claimed insurance during construction of Rs. 92.359 million, which is 0.89% of the assessed EPC cost at COD. The insurance arrangement has been carried out with Adam Jee Insurance Company Limited for the two policies i.e Comprehensive Project Insurance and Terrorism. These are also covered under the Schedule of the EPA. The break -up of claim is as follows:

Description US$ in M Rs. in M Insurance cost 1.020 106.835 I ,ess: FED (0.124) (13.038) Federal insurance fees (0.008) (0.872) Stamp Duty (0.005) (0.566) Total Insurance cost claimed 0.883 92.359

2.9.3 In support of its claim. MPCI. has provided evidence of Insurance policies, invoices, premium payment receipts, bank drafts/cheques. The Authority decided to allow the amount of US $ 0.849 million (Rs. 89.030 million) that includes the Federal Insurance Fee (FM amounting to US $ 0.008 million (Rs. 0.872 million), cumulatively being 0.86% of EPC Cost which is within the allowed limit of 1.35%.

2.10 Non-EPC and project development costs:

2.10.1 A comparison of subject mentioned costs allowed in the tariff determination and claimed by MPCI, in its COD adjustment request. is as follows:

As per tariff determination Claimed at CQD stage Description US $ in M Ref. Ex Rate Rs. in M US $ in M Ref. Ex Rate Rs. in M Non EPC & PDC 3.916 87.75 343.629 6.29 99.66 626.87 Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2.10.2 The summary of the claimed costs is as under: PDC Cost detail:

PDC Description PKR USD Ref. # Technical Consultants Sgurr Energy Limited 76,794,290 750,584.00 OMS (PVT.) LTD 14,039,647 134,319.45 Garrad Hassan 6,437,733 72,752.38 First Wind_ipvt.) Limited - Surveyer Charges 4,065 000 38,927 17 1- ast West Infinity (Private) Limited 3,475,467 43,485 84 Advisors Fee - Legal Latham & Watkins 11.1) 71,637,518 691,257.57 Orr- Dignam & Company_ 14,984,391 153,082.91 ALTERNATIVE ENERGY (AEDB) LEGAL ILLS 4,920,000 50,000.00 Allen & Overy 2,213,079 21,101.06 Barker Gillette LLP 1,642,420 16,007.99 MFB Solicitors 1,190,983 12 109.51 Insurance Survey Charges Albert & Fabel GmbH & Co. KG 713,044 6,829.92 freightcare Marine Services Co. Ltd 263,685 2,525.72 National Electric Power Regulatory 3,964,528 40,787.14 Financial Consultant -Bridge Factor 79,195,007 804,576.83 Other Environmental Resources Management (1.12M) 9,683,724 97,222.24 CPPA 2,431,862 23,316.03 NTDC 1,977,300 18,885 39 Axis Environment Services 1,275,300 12,898.64 Power Planner International 750,000 8 968 51 GEO Technical service 636,500 7,997.34 Research & Development Consultant 478,723 5,925.30 'Total 302,770,201 3,013,561 Non EPC Cost detail:

Non EPC Description PKR USD Ref. # 88,235,548 880,963.44 ___ Salaries and benefits Travelling and Vehicle runningexpenses 62,578,676 616,534.81 Legal/ Fee & Subscription/ Consultancy Charges 40,667,053 420,993.69 Office Rent 23,433,581 233,159.53 Other General Expenses 17,737,061 177,311.87 Communication and Utility_charges 10,066,177 99,887.15 Fixed Assets I ixed Assets 81,381,938 848,009.85 Sub Total 324,100,033 3,276,860 Grand -Iota! 626,870,234 6,290,421

2.10.3 The Non EPC and PDC cost claimed has been verified on sampling basis, and the amount as determined by the Authority at the time of tariff determination has been considered to he allowed and restricted. Therefore, the Authority hereby allows US $ 3.916 million (Rs. 390.247 million) on account of Non-EPC and PDC incurred.

2.11 ROE and Return on Equity During Construction (ROEDC):

2.11.1 The Authority has allowed 17% return on equity in the tariff determination. Return on equity during construction (ROEDC) was also allowed in tariff determination.

2.11.2 The tariff determination provides following mechanism for the adjustment of ROE and ROFDC component; Decision in the matter of Metro Power Company Limited `11.411(1. tariff adjustmems at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

"I: The ROEDC will be adjusted at COD on the basis of actual equity injections (within the overall equity allowed by the Authority at COD) during the project construction period allowed by the Authority."

g. The Return on equity (including return on equity during construction) will be adjusted at COD on the basis of PKR/US$ exchange rate."

2.11.3 MPCL. in its COD adjustment request claimed ROE US $ 18.711 million (including ROEDC) @ 17% based on equity injections of US $ 32.896 million and claimed ROE and ROEDC component of Rs. 4.1029/kWh and Rs. 1.6362/kWh respectively.

2.11.4 In the tariff determination the 75:25 debt: equity contribution was allowed to MPCL. MPC1. vide its COD tariff adjustment request claimed 72:28 debt : equity contribution, however as referred earlier, the request was not submitted within the stipulated time (i.e 6 months after the award of tariff). Consequently the capital structure of 75:25 debt : equity is taken into account for COD stage tariff determination as covered in para 2.7.2/above. Accordingly assessed equity as per the actual 75:25 debt: equity contribution is US $ 28.274 million (Rs. 2,923.914 million).

2.11.5 Accordingly, the amount of ROEDC calculated based on actual 75:25 debt: equity contribution and allowed construction period is US $ 8.727 million. The amount of ROEDC works out to US $ 7.502 million (Rs. 783.302 million). The Authority therefore approved the ROEDC component of Rs. 0.9781/kWh and ROE component as Rs. 3.5263/kWh as per the allowed 17% rate.

2.12 Insurance during Operations:

2.12.1 In the tariff determination, M PC!, was allowed insurance component of Rs. 0.6712/kWh. The tariff determination had specified that:

"In case insurance denominated in US $, insurance cost component of tariff will be adjusted on account of US$/PKR exchange rate variation on annual basis. Further, insurance component of the reference tariff will be adjusted as per actually incurred prudent costs, subject to maximum of 1.35% of the EPC cost, on annual basis upon production of authentic documentary evidence by the petitioner.

2.12.2 MPCI. has claimed Rs. 61.436 million (0.59% of the assessed EPC cost) for insurance during operations for the period of lyr (365 Days) i.e. from Sep 16, 2016 to Sep 15, 2017 with Adam Jee Insurance Company Limited. Based on the submitted information, the Authority allows insurance during operation component Rs.0.4317/kWh being the actual amount also well within the allowed threshold.

2.13 Pre-COD Sale of Electricity:

2.13.1 MPG. in its COD tariff adjustment request has submitted that during the testing and grid energization phase, 10,797,490 kWh were produced and delivered to national grid by the Petitioner. As per the petitioner, under the upfront tariff for wind issued in 2013 and

Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

2015, the Project Company may he allowed to charge tariff excluding principal repayment of debt component and interest component for the electricity delivered to the national grid prior to COD.

2.13.2 The tariff determination with respect to pre-COD sale provided that; "The Authority has in earlier comparable determination allowed sale of electricity prior to COD pursuant to bilateral agreement on mutually agreed terms between the buyer and the seller. The Authority here by maintains its decision on this issue in the case of the petitioner. The mutually agreed tariff for COD sale of energy shall in no case be higher than the tariff determined by the Authority"

2.13.3 In view of above it is clear that buyer and the seller has to mutually agree the rate for the purpose within the parameters specified. Therefore, this claim of the petitioner does not require any consideration by the Authority as part of the COD stage tariff adjustment.

2.14 Indexation of O&M:

2.14.1 Following is the detail of indexations of O&M component of tariff:

Year 1-2 Year 3-10 Year 11-20 O&M component Local Foreign Local Foreign Local Foreign

Ref erence (Rs/kWh) 0.2410 0.4885 0.3088 1.1095 0.2792 1.2038

Re 'ised (Rs/kWh) 0.3229 0.6174 0.4137 1.4022 0.3741 1.5214

Index Number Month Particulars Reference Values: Pakistani WPI (Manufacturer) 209.47 July 2011 US CPI 226.889 Sep 2011 Exchange rate (PKR/US$) 87.75 Reference Ex. Rate Revised Values: Local CPI (General) 154.72 July 2011 Local CPI (General) 207.3 June 2016 US CPI 241.018 June 2016 At COD Sep 16, Exchange rate (PKR/US$) 104.4 2016 2.15 The O&M components have been indexed at COD. Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

3. Order Pursuant to Section 7 of the NEPRA Act, 1997 read with Rule 6 of the National Electric Power Regulatory Authority Licensing (Generation) Rules, 2000, Metro Power Company Limited (the Petitioner) is allowed to charge the following specified/approved tariff for delivery of electricity to the power purchaser:

Year Year Year Tariff Components Indexation 1-2 3-10 11-20 Rs./kWh. Rs./kWh. Rs./kWh.

O&M Local 0.3229 0.4137 0.3741 CPI Foreign 0.6174 1.0422 1.5214 PKR/US$ & US CPI Insurance 0.4317 0.4317 0.4317 PKR/US$ Return on equity 3.5263 3.5263 3.5263 PKR/USS Return on equity during 0.9781 0.9781 0.9781 PKR/US$ construction PKR/US$ & LIBOR for Debt service 8.5552 8.5552 foreign loan and KIBOR for local loan

The tariff has been calculated on the basis of net annual benchmark energy generation of 142.30 GWh at annual net plant capacity factor of 32.49% for installed capacity of 50 MW. ii) 'Me above charges will be limited to the extent of net annual energy generation of 142.30 GWh. Net annual generation supplied to the power purchaser in a year, in excess of benchmark energy of 142.30 GWh will be charged at 10% of the prevalent approved tariff. iii) In the above tariff no adjustment for carbon emission reduction receipts, has been accounted for. However, upon actual realization of carbon emission reduction receipts, the same shall be distributed between the power purchaser and the petitioner in accordance with the approved mechanism given in the GoP Policy for Development of Renewable Energy for Power Generation 2006, as amended from time to time. iv) The PKR/US dollar exchange rate has been taken as Rs. 104.40. v) The above tariff is applicable for a period of twenty (20) years commencing from the commercial operations date. vi) The monthly benchmark energy table along with monthly power curves should be verified by the Alternative Energy Development Board (AEDB)/power purchaser -- Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

before finalization of the energy purchase agreement. vii) The petitioner is entitled to payment of wind speed risk by the power purchaser in accordance with the GoP Policy for Development of Renewable Energy for Power Generation 2006, as amended from time to time and the mechanism approved by the AEDB. viii) The component wise reference tariff is indicated at Annex-I.

Debt Servicing Schedule is attached as Annex-II.

Pass-Through Items

No provision for has been accounted for in the tariff. If any tax is imposed on the petitioner, the exact amount paid by the petitioner shall be reimbursed by the power purchaser to the petitioner on production of original receipts. This payment will be considered as a pass-through payment spread over a 12 months period.

Furthermore, in such a scenario, the petitioner shall also submit to the power purchaser details of any tax shield savings and the power purchaser shall deduct the amount of these savings from its payment to the petitioner on account of taxation. Withholding tax on dividends is also a pass through item just like other taxes as indicated in the government guidelines for determination of tariff for new IPPs. The power purchaser shall make payment on account of withholding tax at the time of actual payment of dividend, subject to maximum of 7.5% of 17% return on equity (including return on equity during construction). In case the petitioner does not declare a dividend in a particular year or only declares a partial dividend, then the difference in the withholding tax amount (between what is paid in that year and the total entitlement as per the net return on equity) would be carried forward and accumulated so that the petitioner is able to recover the same as a pass through from the power purchaser in future on the basis of the total dividend payout.

111. Indexations:

The following indexation shall be applicable to the reference tariff: i) Indexation applicable to O&M The local part of O&M cost will be adjusted on account of local inflation and O&M foreign component will be adjusted on account of variation in dollar/rupee exchange rate and US CPI. Quarterly adjustments for inflation and exchange rate variation will he made on Is' July, October, 1s January and Isl April respectively on the basis of latest available information with respect to CPI (notified by the Federal Bureau of Statistics)/alternative index determined by the Authority, US CPI (notified by US Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-201

bureau of labor statistics) and revised TT & OD selling rate of US Dollar as notified

by the National Bank of Pakistan. The mode of indexation will be as follows:

F O&M (LREVI = O&M Mill-) * CP1(re,) /207.30

F O&M (FREv)

F O&M (LREV) = The revised applicable fixed O&M local component of tariff

F O&M (FREE) = The revised applicable fixed O&M foreign component of tariff

indexed with US CPI and exchange rate Variation

O&M (FREE) The reference fixed O&M local component of tariff for the relevant

period

O&M (FREE) = The reference fixed O&M foreign component of tariff for the

relevant period

CP1(REV) The revised consumer price index (general) / alternative index

determined by the Authority

CP1 (REF) 207.30 consumer price index (general) of June 2016 notified by the

Federal Bureau of Statistics / alternative index determined by the

Authority.

US CPI (REV) = The revised US CPI (all urban consumers)

US CPI (km — 226.889 US CPI (all urban consumers) for the month of September

2011 as notified by the US Bureau of Labor Statistics

FR (REV ) the revised TT & OD selling rate of US dollar as notified by the

National Bank of Pakistan

ii) Adjustment of insurance component

In case of insurance denominated in US $, insurance cost component of tariff will be

adjusted on account of USVP1s,R exchange rate variation on annual basis. Further,

insurance component of the reference tariff will be adjusted as per actually incurred

prudent costs, subject to maximum of 1.35% of the approved EPC cost, on annual

basis upon production of authentic documentary evidence by the petitioner. iii) Return on equity

The return on equity component of tariff will be adjusted on the basis of revised

& OD selling rate of US Dollar as notified by the National Bank of Pakistan

according to the following formula: Decision in the matter of Metro Power Company Limited nerd ",5t tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

ROE (REv) = ROE(REF) x ER(REv) / ER(REF)

Where:

ROE (REv) = Revised return on equity component of tariff expressed in Rs/kWh.

ROE (REF) = Reference return on equity component of tariff expressed in Rs/kWh.

ER (REv) = The revised TT & OD selling rate of US dollar as notified by the National Bank of Pakistan

ER (REF) — The reference TT & OD selling rate of US dollar

Return on equity during construction

The return on equity during construction component of tariff has been adjusted on the basis of revised TT & OD selling rate of US Dollar as notified by the National Bank of Pakistan according to the following formula:

ROEDC (REv) = ROEDC (REF) x ER(REv) / ER(REF)

Where:

ROEDC (rev) = Revised return on equity during construction component of tariff expressed in Rs/kWh.

ROEDC (ref) = Reference return on equity during construction component of tariff expressed in Rs/kWh.

ER (REv) = The revised 'Ii' & OD selling rate of US dollar as notified by the National Bank of Pakistan

ER (REF) = The reference TT & OD selling rate of US

Adjustment for 1.1130R/KIBOR variation

The interest part of fixed charge component will remain unchanged throughout the term except for the adjustment due to variation in 6 months LIBOR/KIBOR, while spread of 4.50% on 6 months LIBOR and 3% on 6 months KIBOR remaining the same, according to the following formula:

For foreign financing

A I P (REV)* (LIBOR (REV 0.79%) / 2

Where: Decision in the matter of Metro Power Company Limited tariff adjustments at commercial operation date (COD) Case No. NEPRA/TRF-193/MPCL-2011

AI the variation in interest charges applicable corresponding to variation in 6 months LIBOR. A I can be positive or negative depending upon whether 6 months LIBOR (12n) per annum > or < 0.79%. The interest payment obligation will be enhanced or reduced to the extent of A I for each half year under adj ustment.

Wind Power Plant's Performance Data:

The petitioner shall install monitoring masts with properly calibrated automatic computerized wind speed recording meters at the same height as that of the wind turbine generators and a compatible communication/SCADA system both at the wind farm and power purchaser's control room for transmission of wind speed and power output data to the power purchaser's control room. l'xnissions Trading/ Carbon Credits:

The petitioner shall process and obtain emissions/carbon credits expeditiously and credit the proceeds to the power purchaser as per the GoP Policy for Development of Renewable Energy for Power Generation 2006, as amended from time.

Other:

The Authority has allowed/approved only those cost(s), term(s), condition(s), provision(s), etc. which have been specifically approved in this tariff determination. Any cost(s), term(s), condition(s), provision(s), etc. contained in the tariff petition or any other document which are not specifically allowed/approved in this tariff determination, should not be implied to be S approved, if not adjudicated upon in this tariff determination.

AUTHORITY

(Saif Ullah Chattha) (Rafique AhirZ Member Z..? 2_-.2.6/.5r Member

(RehmatullaF a och Vice Chairman Annex-I

METRO POWER COMPANY LIMITED REFERENCE TARIFF TABLE

Return on Return O&M equity Withholding Loan Interest Insurance on Tariff during tax @7.5% repayment charges Year equity construction Local Foreign Rs. / kWh Rs. / kWh Rs. / kWh Rs. / kWh Rs. / kWh Rs. / kWh R& / kWh Rs. / kWh Rs. / kWh

1 0.3229 0.6174 0.4317 3.5263 0.9781 0.3378 4,2205 4.3348 14.7694 2 0.3229 0.6174 0.4317 3.5263 0.9781 0.3378 4.5317 4.0236 14.7694 3 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 4.8673 3.6879 15.6450 4 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 5.2295 3.3258 15.6450 5 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 5.6203 2.9350 15.6450 6 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 6.0422 2.5131 15.6450 7 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 6.4977 2.0576 15.6450 8 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 6.9897 1.5655 15.6450 9 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 7.5212 1.0340 15.6450 10 0.4137 1.4022 0.4317 3.5263 0.9781 0.3378 8.0957 0.4596 15.6450 11 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 12 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 13 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - 7.1694 14 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 15 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 16 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - 7.1694 17 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 7.1694 18 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 19 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694 20 0.3741 1.5214 0.4317 3.5263 0.9781 0.3378 - - 7.1694

Levelized 0.3842 1.2754 0.4317 3.5263 0.9781 0.3378 4.0661 2.1085 13.1081

The reference tariff has been calculated on the basis of net annual benchmark energy generation of 142.3 GWh. Net annual generation supplied to the power purchaser in a year, in excess of benchmark energy of 142.3 GWh will be charged at 10% of the prevalent approved tariff.

Exchange rate 1US5/PKR 104.40 Lewlized tariff @ 10% works out to US cents 12.5556

EIER RE

4 U.i N EP RA - - ..bop AUTHORITY

1

23 Annex-II

METRO POWER COMPANY LIMITED DEBT SERVICING SCHEDULE

, _ Local Debt Foreign Debt Annual Annual

d Annual Total Debt Total Debt Principal Debt io Principal Interest Balance Principal Interest Balance Interest Repayment Service Repayment Service Repayment Servicing Per US$ in M US$ in M US$ in M US$ in M US$ in M US$ in M US$ in M US$ in M US$ in M US$ in M Rs./kWh R&IkWh R&/kWh 44.132 1.402 1.999 42.730 3.402 37.129 1.423 1.006 35.706 2.429 42.730 1.466 1.936 41.264 3.402 35.706 1.462 0.968 34.245 2.429 1 44.132 2.868 l' 3.935 41.264 6.803 37.129 2.885 i' 1.974 34.245 4.858 4.2205 4.3348 8.5552 41.264 1.532 1.869 39.732 3.402 34.245 1.501 0.928 32.743 2.429 39.732 1.602 1.800 38.130 3.402 32.743 1.542 0.887 31.202 2.429

2 41.264 3.134 ' 3.669 38.130 6.803 34.245 3.043 ' 1.815 31.202 4.858 4.5317 4.0236 8.5552 38.130 1.674 1.727 36.456 3.402 31.202 1.584 0.846 29.618 2.429 36.456 1.750 1.651 34.706 3.402 29.618 1.627 0.803 27.991 2.429 3 38.130 3.424 ' 3.379 34.706 6.803 31.202 3.210 ' 1.648 27.991 4.858 4.8673 3.6879 8.5552 34.706 1.829 1.572 32.876 3.402 27.991 1.671 0.759 26.321 2.429 32.876 1.912 1.489 30.964 3.402 26.321 1.716 0.713 24.605 2.429

4 34.706 3.742 t 3.061 30.964 6.803 27.991 3.387 1.472 24.605 4.858 5.2295 3.3258 8.5552 30.964 1.999 1.403 28.965 3.402 24.605 1.762 0.667 22.842 2.429 28.965 2.089 1.312 26.876 3.402 22.842 1.810 0.619 21.032 2.429 5 30.964 4.088 2.715 26.876 6.803 24.605 3.573 1.286 21.032 4.858 5.6203 2.9350 8.5552 26.876 2.184 1.217 24.692 3.402 21.032 1.859 0.570 19.173 2.429 24.692 2.283 1.119 22.409 3.402 19.173 1.910 0.520 17.263 2.429 6 26.876 4.467 2.336 22.409 6.803 21.032 3.769 1.090 17.263 4.858 6.0422 2.5131 8.5552 22.409 2.386 1.015 20.022 3.402 17.263 1.961 0.468 15.302 2.429 20.022 2.495 0.907 17.528 3.402 15.302 2.015 0.415 13.287 2.429

7 22.409 4.881 1.922 17.528 6.803 17.263 3.976 0.883 13.287 4.858 6.4977 2.0576 8.5552 17.528 2.608 0.794 14.920 3.402 13.287 2.069 0.360 11.218 2.429 14.920 2.726 0.676 12.195 3.402 11.218 2.125 0.304 9.093 2.429 8 17.528 5.333 1.470 12.195 6.803 13.287 4.194 0.664 9.093 4.858 6.9897 1.5655 8.5552 12.195 2.849 0.552 9.345 3.402 9.093 2.183 0.246 6.910 2.429 9.345 2.978 0.423 6.367 3.402 6.910 2.242 0.187 4.668 2.429 9 12.195 5.827 0.976 6.367 6.803 9.093 4.425 0.434 4.668 4.858 7.5212 1.0340 8.5552 6.367 3.113 0.288 3.254 3.402 4.668 2303 0.126 2.365 2.429 3.254 3.254 0.147 (0.000) 3.402 2.365 2.365 0.064 2.429 10 6.367 6.367 (0.000) 6.803 4.668 4.668 0.191 - 4.858 8.0957 0.4596 8.5552

NOMA AUTHORITY) 11 1,V-