ISLAMABAD: Khyber Pakhtunkhwa Chief Minister Sardar Ali Amin Gandapur has appealed to Prime Minister Shehbaz Sharif to facilitate an “out-of-the-box” resolution to the long-standing Net Hydel Profit (NHP) issue, which remains unresolved between WAPDA and the provinces.
In a letter to the Prime Minister, Gandapur invoked Article 161(2) of the Constitution, which guarantees net profits from hydroelectric power generation to the provinces. He highlighted that the Kazi Committee Methodology (KCM), endorsed by the Council of Common Interests (CCI) and upheld by the Supreme Court, has formed the legal and constitutional basis for NHP payments since 1991.
While an interim arrangement, introduced in 2016 and backed by the CCI, allowed NHP payments at Rs1.10/kWh with 5% annual indexation, Gandapur noted that inconsistent payments by WAPDA have led to an accumulated shortfall of Rs75 billion for KP.
He cited the CCI’s 2018 decision to form a committee under the Deputy Chairman of the Planning Commission, which later validated KP’s NHP share at Rs128 billion for FY 2016–17. Another committee was then formed to propose an innovative solution, but despite five meetings, no resolution has been reached.
The Chief Minister stressed the urgency of the matter given the province’s severe financial constraints and requested the Prime Minister’s intervention to convene the “Out-of-the-Box” Committee immediately.
KP’s three key proposals include:
- Direct Federal Payment: Payment of NHP by the federal government in accordance with Article 161(2), CCI decisions, and the 2019 Jehanzeb Committee report, with financing possibly routed through PSDP.
- Transfer of Hydropower Assets: Transfer of existing hydro power plants from WAPDA to provinces, as allowed under Power Generation Policies 1995 and 2015, with WAPDA retaining O\&M responsibilities during the transition.
- Second Interim Arrangement: Temporarily raising the consumer-end electricity tariff by Re1/kWh to fund pending NHP dues, with CPPA-G making direct payments to provinces via an escrow mechanism instead of WAPDA.
Gandapur reiterated that CPPA-G is now the revenue collection agency for the power sector, and therefore should be responsible for making NHP payments.
Expressing confidence in the Prime Minister’s leadership, the KP Chief Minister urged for swift and fair action to uphold the constitutional rights of provinces and ensure equitable resource distribution.
Story by Mushtaq Ghumman
