Pakistan set to deregulate power sector

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Pakistan will introduce the Competitive Trading Bilateral Contracts Market (CTBCM) in May 2022 to deregulate the power sector, allowing private generators and consumers to purchase and sell electricity, WealthPK reported.

National Electric Power Regulatory Authority (Nepra) Chairman Tauseef H Farooqi said that CTBCM would prove to be a game-changer for the power industry of Pakistan.

“Implementation plan of the CTBCM model will usher in a competitive environment in the power sector benefiting the country. We have a successful telecom sector model that we are attempting to emulate. We are providing customers with a choice. Now they have the ability to buy and sell power on their own. We’re attempting to deregulate the market. The goal is to transition from multi-seller-single-buyer model to multi-seller-multi-buyer model,” he stated.

In the power market, competitive trading and bilateral contracts allow for more competition between the participants in the generation, transmission and distribution of electricity. Business entities are permitted and given an enabling environment in which to earn returns on their investments through competition with other market participants.

The instances of “oligopoly” in the market are being minimised where the free-market forces would decide the tariff settlements, economic dispatch, demand forecast and generation costs of the units. All these participants and operators would be licensed under Nepra in the new regime. The operators would facilitate the energy trade between the participants. —INP

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