By Engr. Rizwan Ahmad, Former Member (Power) WAPDA Khyber Pakhtunkhwa
Stands at a defining moment in the management of its hydropower sector. Over the past fifteen years, the province has invested billions of rupees in developing hydropower projects through the Pakhtunkhwa Energy Development Organization (PEDO). Power plants such as MALAKAND-III, PEHURE, MACHAI, RESHUN (CHITRAL), SHISHI, DARAL KHWAR, KOTO, JABORI, AND KARORA HPPs, together representing an installed capacity of approximately 224 MW, were established to harness the province’s abundant water resources and transform them into clean electricity, sustainable public revenue, and long-term economic value for the province. However, the construction of hydropower plants is only the first step; their real success ultimately depends on how efficiently they are operated and maintained over their long operational life. The two larger plants, MALAKAND-III (81 MW) and PEHURE (18 MW), were therefore outsourced for Operation and Maintenance (O&M) for an initial period of five years following their commissioning in 2008 and 2010 respectively, primarily because PEDO did not yet possess the institutional capacity to manage the O&M of these newly commissioned facilities. This outsourcing arrangement was intended to be purely transitional. It was envisaged that PEDO engineers would be gradually attached to the contractor’s operational teams in order to gain practical experience and technical exposure. The objective was to develop sufficient in-house capacity so that, after the initial five-year period, PEDO would be able to assume full responsibility for the operation and maintenance of these plants through its own trained personnel. However, the experience of outsourced Operation and Maintenance (O&M) at Malakand-III HPP and PEHURE HPP did not yield the intended results. Limited institutional ownership and the absence of long-term operational commitment from external contractors led to premature failures of critical turbine and generator components. Consequently, all three generating units of Malakand-III HPP required major overhauling by PEDO within less than fifteen years of operation, significantly earlier than the normal service life expected for such equipment. This stands in stark contrast to many of WAPDA’s hydropower stations, which, some despite being over seventy years old, continue to operate reliably under indigenous O&M. Resultantly the financial and operational consequences have been substantial. The rehabilitation of Malakand-III HPP required procurement of costly replacement components from foreign manufacturers in foreign exchange, imposing an additional burden exceeding Rs 1,900 million. Furthermore, under outsourced O&M, the plant has consistently failed to achieve its designed annual generation target of 550 GWh, with an average shortfall of approximately 185 GWh per year. This underperformance translates into an estimated annual economic loss exceeding Rs 4,600 million to the national economy. In comparison, hydropower plants managed under PEDO’s indigenous O&M model, particularly DARAL KHWAR 36.6 MW, have demonstrated stable and efficient operation, even exceeding their design annual energy targets in certain years. On the other hand, the desired transition to indigenous O&M as planned was never implemented by PEDO. Instead, the outsourcing contracts for MALAKAND-III and PEHURE were repeatedly extended and renewed. During the same period, the O&M of the 17 MW RANOLIA Hydropower Plant was also outsourced. This plant was later severely damaged during the devastating flash floods of August 2022 and currently remains under rehabilitation. Page 1 of 3 Even more concerning is that the Operation and Maintenance (O&M) contracts for MALAKAND-III and PEHURE HPPs were awarded for a fourth time, despite the fact that PEDO in 2020 had already launched a structured capacity-building program aimed at transitioning towards indigenous O&M. Through this initiative which was taken in accordance with the PEDO Act, 2020, PEDO engineers and technicians have successfully demonstrated their capability by operating several hydropower plants, including 36.6 MW DARAL KHWAR , 2.6 MW MACHAI, 40.8 MW KOTO, 11.8 MW KARORA and 10.2 MW JABORI, 4 MW RESHUN & 1.8 MW SHISHI, entirely through internal resources. Action is on cards for recruiting additional experienced engineers and technical personnel to further strengthen its O&M teams. Recognizing the strategic importance of institutional self-reliance in managing public infrastructure, the Government of Khyber Pakhtunkhwa had earlier approved an indigenous O&M framework through the PEDO Board and the Provincial Policy Board. Under this policy, the responsibility for operating and maintaining the province’s hydropower plants rests with PEDO’s own engineers and technical staff. The rationale was straightforward; critical public infrastructure must be managed with institutional ownership, technical accountability and long-term sustainability, rather than relying indefinitely on short-term contractual arrangements. The DARAL KHWAR Hydropower Plant provides a particularly compelling example of this capability. Following the devastating flash floods of August 2022, the plant suffered severe damage to its electromechanical equipment. Remarkably, the facility was restored to operation within forty days through the efforts of PEDO’s in-house trained and experienced engineers, without relying on external contractors. Similarly, when turbine damage occurred during the commissioning phase of the JABORI Hydropower Plant in 2023, the rehabilitation of the damaged components was successfully carried out by PEDO’s engineers and technicians. It is worthwhile to mention that the team of the young engineers of the level of Directors and Assistant Directors along with Sub-Engineers, being regular employees of PEDO, were fully trained in WAPDA institutes of international caliber, including MANGLA Hydel Power Training Institute (HPTI) of WAPDA, WAPDA Engineering Academy Faisalabad and WAPDA Administrative Staff College Islamabad. These successes demonstrate that PEDO has not only developed the technical capability but has also established a functioning institutional framework for self-reliant plant operations. Today, the organization has significantly strengthened its internal capacity for indigenous O&M, not only for newly commissioned plants but also to gradually assume the operation and maintenance of larger stations such as MALAKAND-III and PEHURE in the near future. These experiences demonstrate that the province already possesses the technical expertise required to manage its hydropower infrastructure. Beyond technical considerations, financial comparisons also raise important questions. Estimated annual operating costs indicate that indigenous O&M is significantly more economical than contractorbased arrangements. For instance, the annual cost of operating the 40.8 MW Koto Hydropower Plant through PEDO’s own workforce is estimated at around Rs105 million, whereas outsourced O&M could cost more than Rs228 million annually. Similar cost differences exist for other projects as well. More importantly, outsourcing core operational responsibilities risks weakening the institutional capacity that PEDO has gradually developed over the past eighteen years or so. Hydropower plants are long-life engineering assets whose reliability depends heavily on disciplined maintenance, operational continuity and institutional knowledge. These qualities are difficult to sustain under short-term contracting arrangements driven primarily by commercial incentives. There is also a broader strategic consideration. Several major hydropower projects are currently under development in Khyber Pakhtunkhwa. As these plants come online, the province will require a strong technical institution capable of managing a growing portfolio of hydropower assets. Strengthening the indigenous O&M model would allow PEDO to evolve into a technically robust institution capable of managing these assets with professionalism and accountability. It would also ensure that the economic Page 2 of 3 benefits of publicly financed hydropower projects remain within the province while creating opportunities for local engineers and technicians. However, at this critical stage, a group of retired senior PEDO officers, now associated as partners with private O&M contractors, have reportedly begun lobbying to influence policy decisions in favor of outsourcing the operation and maintenance of both existing and upcoming hydropower projects. Such efforts appear aimed at securing commercial benefits from projects that have been developed by PEDO through substantial public investment, including loans obtained from local and international financial institutions at substantial interest rates. These efforts reportedly extend not only to the existing operational hydropower plants of PEDO but also to major projects nearing completion, including the 84 MW GORKIN-MATILTAN, 300 MW BALAKOT, and 84 MW GABRAL-KALAM Hydropower projects. Such developments are deeply concerning since if these attempts succeed, they could undermine PEDO’s growing technical capacity and institutional autonomy, while placing valuable public assets of the provincial government, worth billions of rupees, under arrangements that may not adequately safeguard its long-term strategic interests. The indigenous Operation and Maintenance (O&M) of PEDO’s hydropower plants is fully aligned with the mandate of the PEDO Act, 2020, which explicitly empowers the organization to “plan, develop, construct, own, operate and maintain” energy projects within the Province. The responsibility for plant operations therefore lies squarely within PEDO’s statutory functions, and the adoption of an indigenous O&M framework by the PEDO Board and Provincial Policy Board is both legally sound and consistent with the Act’s intent to build institutional capacity. Importantly, the Act does not mandate outsourcing; rather, it enables PEDO to utilize its own technical resources wherever capacity exists. Any reversal of this approved policy would not only be inconsistent with the legal framework but could also weaken institutional capacity and redirect valuable revenues away from strengthening the Province’s energy sector. The real test before policymakers today is whether these publicly funded hydropower assets will become the foundation of a strong provincial energy institution or gradually evolve into long-term revenue streams for private contractors. The answer will shape the future of Khyber Pakhtunkhwa’s hydropower sector for decades to come. Such action will support Pakistan’s efforts to focus on increased utilization of hydropower resources in the wake of escalating conflict in the Middle East that has disrupted global fuel markets and strained power supplies, with far reaching long-term implications. The writer is a Hydro Power professional and Former Member (Power) WAPDA. He can be reached at : rizwan309@hotmail.com
