The Power Division has decided to postpone the net metering tariff rationalization plan due to the recent increase in electricity tariff and pressure from various segments of society. The Prime Minister had initially instructed the Power Division to finalize the net metering tariff rationalization and submit it by May 10, 2024, but the actual deadline was extended multiple times, with the latest deadline set for September 30, 2024.
Despite completing in-house deliberations and having a ready proposal, the Power Division has decided to delay the introduction of the reforms due to the sensitivity surrounding the recent tariff hike. The Division has indicated that the matter will be taken up at an appropriate time, without specifying a date.
In addition to the net metering plan, the Committee formed to review the institutional restructuring of NTDC has advised the lead consultant to submit recommendations and proposals by the extended deadline of October 15, 2024. There are also ongoing discussions regarding the operationalization of a Competitive Electricity Market and the gradual reduction of stranded cost annual cap.
Furthermore, the Power Division has emphasized the need for expedited mine expansion of SECMC to ensure the availability of Thar coal to the Lucky coal power plant by December 2025. Additionally, efforts are being made to convert three Chinese IPPs to Thar coal, with a ministerial delegation visiting China to initiate dialogue and detailed assessments of proposals being conducted.
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Regarding private participation in Distribution Companies (Disco), the Cabinet Committee on Privatization has approved certain companies for outright privatization in the first and second phases, while others have been approved for the Concession Model through long-term agreements. The Power Division has engaged the World Bank as a Financial Advisor for this initiative, with a task completion deadline of January 1, 2026.
The Power Division plans to share the progress made in the power sector and ongoing reforms with Simon J Stolp, Practice Manager for Energy and Extractives at the World Bank, during his visit to Pakistan from September 18-20, 2024. Stolp’s visit aims to follow up on discussions regarding the Bank’s energy sector portfolio and future pipeline priorities.
