ISLAMABAD: The Power Division has put the much-talked about net metering tariff rationalisation plan on ice for the time being, citing recent hike in electricity tariff and subsequent pressure from different segments of society.
In May 2024, Prime Minister had directed Power Division to firm up net metering tariff rationalisation and submit it by May 10, 2024. Actual deadline was May 31, 2024, but it was extended to July 15, 2024 which again extended to September 30, 2024.
According to informed sources, the Power Division shared its position with the Prime Minister Office (PMO), saying that considering sensitivity due to the recent tariff hike, the matter will be taken up at the appropriate time, without mentioning any exact date.
Buyback rate of net metering likely at average energy cost
However, the Power Division confirmed that in-house deliberations were completed and the proposal is ready, adding that once the go-ahead is given to introduce reforms a summary shall be initiated for comments to stakeholders.
On institutional restructuring of NTDC, a meeting of the Committee, constituted under Minister for Economic Affairs (EAD), Ahad Khan Cheema to review and present a way forward on TDC restructuring, was held on August 1, 2024. The Committee advised the lead consultant to submit a skeleton of recommendations/ proposals.
The extended deadline of this task is October 15, 2024. Sharing update on proposed operationalisation of Competitive Electricity Market, Power Division has informed the Prime Minister Office that modalities of wheeling charges are to be worked out by the Cross-Sectoral Committee.
The Working Group is evaluating options for the gradual reduction of stranded cost annual cap and availability of surplus capacity in the system.
On availability of Thar coal to Lucky coal power plant, Power Division is of the view that Government of Sindh is required to expedite financial close of mine expansion of SECMC to achieve RCOD by December 2025. PPIB convened a meeting with Government of Sindh and Secretary Energy to expedite the work.
Giving an update on conversion of three Chinese IPPs i.e.’, Sahiwal, Port Qasim, Hub China to Thar coal, Power Division stated that a ministerial delegation led by Minister for Finance and comprising Power Minister, visited China in July 2024 to initiate dialogue with the Chinese government. The Chinese side sent a delegation on July 31, 2024 to August 5, 2024 for a detailed assessment of each proposal. Deliberations have also been held with a delegation of Port Qasim Plant recently. The deadline for this task is July 1, 2029.
On private participation in Distribution Companies (Disco), Power Division has intimated to the Prime Minister Office, that Cabinet Committee on Privatisation (CCoP) on August 2, 2024 approved IESCO, FESCO, GEPCO for outright privatisation in the first phase and LESCO, MEPCO and HAZECO for outright privatisation in the second phase.
HESCO, SEPO and PESCO were approved for Concession Model through long-term agreements. Power Division has engaged the World Bank as Financial Advisor. The task completion deadline is January 1, 2026.
The sources said that power sector issues and reforms done so far will be shared with Simon J Stolp, Practice Manager for Energy and Extractives, World Bank South Asia Region, who is visiting Pakistan from September 18-20, 2024.
The objective of his visit is to follow up on discussions regarding the ongoing Bank’s energy sector portfolio and future pipeline priorities.
Copyright Business Recorder, 2024
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