ISLAMABAD: In a significant move towards power sector liberalisation, the National Electric Power Regulatory Authority (Nepra) has approved the Wheeling Auction Process and declared the Competitive Market Operations Date (CMOD) effective from January 22, 2026.
Nepra has directed the Independent System and Market Operator (ISMO) to immediately operationalise the auction mechanism and begin preparations for issuing the Request for Proposal (RFP), ensuring transparency, competition, and procedural fairness.
The development follows amendments to Strategic Directive 87 of the National Electricity Plan and Rule 5 of the Eligibility Criteria Rules, 2023, aimed at addressing stranded costs arising from market liberalisation. Subsequently, the government introduced the Framework Guidelines for Wheeling Auctions, 2025, under which ISMO submitted the auction design for regulatory approval.
During consultations, stakeholders raised concerns over the initial 800MW auction cap, terming it insufficient to meet industrial demand, and suggested lowering the 1MW minimum load threshold. ISMO clarified that the cap is a starting point and may be expanded based on market response, while the threshold aligns with international wholesale market practices.
Concerns regarding transmission capacity and pricing transparency were also highlighted. In response, Nepra has mandated ISMO to issue an Interim Congestion Disclosure Note with the RFP to ensure informed bidding, alongside conducting pre-bid technical briefings.
To strengthen governance, Nepra has required conflict-of-interest declarations from all auction committee members and directed publication of a post-auction summary detailing bidder participation and allocation rationale.
Describing Pakistan’s electricity market as being in a transitional phase, Nepra stated that the framework is tailored to local conditions while laying the foundation for a competitive and transparent power market.
With CMOD now in effect, all relevant entities have been instructed to proceed with implementation in line with the approved timelines.
Story by Mushtaq Ghumman
