Power Sector Anticipates Forthcoming Policy Reforms
Waseem Mukhtar, Chairman of the National Electric Power Regulatory Authority (Nepra), announced on Saturday that the government is progressing with the implementation of a Competitive Trading Bilateral Contract Market (CTBCM). This market aims to promote competition among market participants, benefiting consumers through improved service quality and pricing options. The CTBCM will enable electricity suppliers and consumers to directly contract with each other as market dynamics unfold. Mukhtar emphasized that consumers will benefit from this move by having the freedom to purchase electricity of their choice from power distribution companies.
Currently, the power generation capacity stands at 48,000 megawatts. The National Transmission Dispatch Company (NTDC) procures electricity based on production costs. Under the current system, electricity transactions are conducted through a single-buyer model, with the Central Power Purchase Authority Guarantee Limited (CPPA-G) acting as an agent for power distribution companies (DISCOS). CPPA-G also serves as the system operator, matching supply and demand for various DISCOs and handling billing and settlement functions. Mukhtar called for addressing electricity theft to control rising power tariffs and suggested involving the public in the power sector for this purpose.
Mukhtar highlighted the introduction of a free market in the power sector, allowing consumers to choose their electricity provider. He stressed the need for a change in habits, citing the prevalence of free markets worldwide. Exclusive distribution licenses for public sector DISCOs have already expired or are near expiration, with some open to giving up their exclusive jurisdiction for power supply.
Regarding power tariff increases, Mukhtar clarified that decisions were made after public hearings on power hike petitions, with the aim of minimizing the burden on the people. Additionally, a committee has been established to investigate over-billing concerns and assess DISCOs’ performance, with the findings to be submitted to Nepra within one month.