ISLAMABAD: The National Electric Power Regulatory Authority has approved a tariff framework for the import of 104MW electricity, along with an additional 100MW supply from Iran’s state-owned power company TAVANIR, at a tariff capped around 12.40 cents per kilowatt-hour (kWh).
The approval follows an application submitted by the Central Power Purchasing Agency-Guarantee Limited after the Economic Coordination Committee (ECC) endorsed the extension and expansion of the cross-border electricity agreement in August 2023.
Under the proposal, CPPA-G sought continuation of the existing 104MW electricity supply from Iran and approval for an additional 100MW through amendments to the long-standing power purchase agreement signed between the two countries in 2002.
The agreement has undergone several revisions over the years. Amendments 7, 8, and the proposed Amendment 9 introduce updated tariff structures, revised payment mechanisms, and technical arrangements for electricity transmission.
Amendment 7, which has now expired, extended tariff arrangements until December 31, 2024, with payments to be settled within 45 days. Amendment 8 allowed for an additional 100MW electricity supply through the Polan-Gabd transmission line, requiring infrastructure upgrades on both sides of the border.
The proposed Amendment 9 introduces a revised tariff formula linked to international oil prices. Under the mechanism, the electricity tariff will include a fixed charge alongside a variable component tied to the monthly average price of OPEC crude oil, keeping the delivered tariff within the range of 12.40 cents/kWh.
Despite approving the arrangement, NEPRA expressed serious concerns over repeated procedural violations by CPPA-G. The regulator criticized the agency for submitting executed agreements after implementation instead of seeking mandatory prior approvals under the EPPR 2022 regulations.
According to the Authority, the tariff extension request was filed in September 2023 despite covering a period beginning from January 2022, reflecting significant delays and non-compliance with regulatory requirements.
NEPRA noted that previous directives regarding timely submissions had also been ignored, indicating systemic procedural weaknesses within the process. The Authority warned that future cases involving post-facto approvals or delays could result in strict regulatory action.
At the same time, NEPRA acknowledged that there is currently no immediate alternative to imported Iranian electricity for supplying power to the Makran region of Balochistan, which remains heavily dependent on cross-border electricity imports from Iran.
Story by Mushtaq Ghumman
