ISLAMABAD: Member (Finance and Tariff) NEPRA has accused the authority of exceeding its jurisdiction by changing the Commercial Operation Date (COD) of 36.6 MW Daral Khawar Hydropower Project of Pakhtunkhwa Energy Development Organisation (PEDO).
The Authority had issued a generation licence to the project on 19 May, 2017 and approved a levelized reference tariff of Rs.8.4377/kWh on January 09, 2018. Thereafter, the Authority vide its modification decision of May 16, 2022, approved the modified levelized tariff of Rs. 8.2683/kWh.
The issue of delay in commissioning was taken up by the Authority. The Authority in its order of August 15, 2024, under NEPRA (Fine) Regulations, 2021, concluded the proceedings by considering the replies of the licencees as satisfactory and decided to accept the same and the matter stood closed in terms of Regulation 4(6) of the Fine Regulations. However, through the additional notes by the majority Members of the Authority to the order of August 15, 2024, it approved the COD of the Project effective from February 2019.
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According to the revised determination, the Authority has reviewed the submissions of the licencee and is of the considered opinion that these matters were already addressed in the majority of the Authority’s additional note to the August 15, 2024 order regarding the Explanation issued to CPPA-G and PEDO under Regulation 4(1) & 4(2). In that decision, it was concluded that while the project began supplying electricity to the grid in February 2019, delays in installing the backup meter by NTDC led CPPA-G to declare the COD much later, on May 26, 2021.
During this interim period, CPPAG continued purchasing electricity from the power project. The Authority has acknowledged that this project, as a public sector initiative, supplies cost-effective electricity to the national grid and contributes to foreign exchange savings for the national exchequer. The Authority has maintained that the project should not be penalized for delays caused by other entities.
The determination further states that the Authority has consistently supported public sector power projects utilizing indigenous resources, including ongoing WAPDA hydropower projects, by approving returns and/or interest. Accordingly, the Authority has directed that the COD for this project be recognized with effect from the date it began supplying electricity to CPPA-G i.e. February 2019. Consequently, para 18 of the modification decision of May 16, 2022, may read as, “the project has been providing electricity since February 2019, therefore, the Authority has decided to approve the COD with effect from February 2019. However, for any pre-COD sale the tariff of variable O&M, which is also consistent with the standard PPA of hydropower projects as a Pre-COD tariffs is also allowed.”
Member (Finance and Tariff) Mathar Niaz Rana, in his decision stated that the declaration of the COD concerning the delay in commissioning of 36.6 MW Daral Khawar Hydropower Project falls within the jurisdiction of CPPA-G and out of mandated jurisdiction of Nepra.
“In my opinion, if the Authority approves the COD effective from February 2019, then this instance exceeds its jurisdiction. Furthermore, any subsequent suo motu proceeding(s) to alter the tariff based on this decision were beyond its mandate and could set an incorrect/inappropriate precedent, potentially influencing similar cases in future. I agree with the submissions of CPPA-G submitted on November 01, 2024.
Copyright Business Recorder, 2025
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