ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has raised serious objections to proposed amendments in the National Electricity (NE) Plan 2023–27 and Supplier Eligibility Criteria (SEC) Rules, 2023, warning that the changes could obstruct the rollout of the Competitive Trading Bilateral Contract Market (CTBCM).
In its response to an Office Memorandum issued by the Ministry of Energy (Power Division) on April 21, 2025, Nepra highlighted that the framework for recovering stranded costs—a cornerstone of market liberalisation—must be embedded within the NE Plan itself. Relying on secondary documents, the Authority cautioned, violates the spirit of Section 14A of the Nepra Act.
Nepra also strongly opposed the interim recovery approach in Strategic Directive 87, which seeks to recover stranded costs equal to full generation capacity charges from bulk power consumers. The regulator noted that this approach had previously hindered CTBCM implementation and called for a well-defined cost recovery mechanism within the NE Plan to ensure clarity and regulatory predictability.
Another key concern was the proposed 800MW cap on open access. Nepra argued that such a cap is absent from the Nepra Act, NE Policy, and the approved CTBCM design. It warned that an arbitrary cap without clarity on allocation criteria could cause market distortion. Instead, it proposed allowing the federal government—through consultation with Nepra—to apply temporary caps via a competitive and transparent framework based on actual market conditions.
On the SEC Rules, Nepra reiterated its legal objection to Rule 5, which deals with the recovery and collection of charges. The Authority stressed that the rule exceeds the scope of Section 23E of the Nepra Act, which limits the federal government’s role to defining eligibility criteria related to solvency, technical capability, and public service obligations. Notably, Rule 5 is already under legal scrutiny in the Islamabad High Court (W.P. No. 4492/2023: APTMA vs. Federation of Pakistan).
In conclusion, Nepra urged the Ministry of Energy to reconsider the proposed amendments in light of the Authority’s legal and regulatory concerns, to ensure smooth implementation of the CTBCM and alignment with statutory provisions.
Story by Mushtaq Ghumman
