KARACHI: The National Electric Power Regulatory Authority (NEPRA) has granted a certificate of registration to the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G) as a market operator under certain conditions.
As market operator, the transformed CPPA-G will be responsible for almost all buying and selling of electricity at market prices from power generation to transmission and distribution companies. The registration shall be valid for a period of five years. An application to register CPPA-G as a market operator was admitted by NEPRA in July 2017.
However, experts believed that the ‘Competitive Power Market Model’ was finalized and approved without taking any feedback from the stakeholders. According to them, the CPPA-G’s application should not have been entertained until the energy sector is opened, de-centralized and liberalized. Also, they opined, the CPPA-G did not have required financial strength to act as a market operator.
The NEPRA is of the view that stringent and proactive regulation/oversight on part of the regulator is fundamental towards ensuring that the CPPA-G fulfils its role as a market operator in the interest of market development and stakeholders. In this regard, the NEPRA has prescribed a set of terms and conditions along with the timeframe for compliance in the certificate of registration.
The power regulator has further identified that the commercial code, being a fundamental regulatory instrument in the development and administration of the energy sector and the upcoming competitive regime, is at present inadequate for fulfilling its purpose and has created legal anomalies and uncertainties for the market participants. Therefore, the authority approved the commercial code with modifications.
The NEPRA said it approved the registration of CPPA-G as market operator under Rule-3 of the Market Rules subject to the terms and conditions set out in the certificate of registration. The grant of registration will be subject to the provisions contained in the NEPRA Act, relevant rules, regulations and codes framed there under and the other applicable documents.
Published in Daily Times, November 20th 2018.
