ISLAMABAD: The Senate Standing Committee on Power, chaired by Senator Mohsin Aziz, is set to meet today (Monday) in a bid to craft an “out-of-box” solution to the longstanding dispute over Net Hydel Profit (NHP) payments between the federal government and provinces, particularly Khyber Pakhtunkhwa (KP).
The Water and Power Development Authority (WAPDA) has distanced itself from directly resolving the issue, pointing to the Power Division and the Central Power Purchasing Agency-Guarantee (CPPA-G) as better positioned to lead efforts. Planning Minister Ahsan Iqbal also heads a parallel committee on the matter.
At the heart of the dispute is the calculation of NHP, rooted in Article 161(2) of the Constitution and the decades-old Kazi Committee Methodology (KCM). While ad-hoc settlements and uncapped rates — such as the Rs 1.10/kWh rate approved in 2016 and later increased by NEPRA — have been implemented, KP has renewed demands for payments strictly under KCM. Punjab has also sought clearance of outstanding dues.
WAPDA maintains that NHP is a pass-through item and that delayed payments from CPPA-G have hampered its ability to pay provinces on time. Current NHP liabilities stand at Rs 49.565 billion for KP and Rs 114.584 billion for Punjab.
The Power Planning & Monitoring Company (PPMC) has argued that NHP should be funded through the federal budget or WAPDA’s hydropower profits, not electricity tariffs, given the changed energy landscape and WAPDA’s unbundling. The Government of Sindh has called for careful consideration of hydropower plant transfers to provinces, emphasizing the primary purpose of dams and involving bodies like IRSA in decision-making.
Despite years of negotiations, a lasting settlement remains elusive, with today’s meeting aiming to break the deadlock.
Story by Mushtaq Ghumman
