ISLAMABAD : The Pakistan Association of Large Steel Producers(PALSP) has proposed dissolution of ” irrelevant” Private Power and Infrastructure Board (PPIB) instead of approval of annual fee of $ 250/MW as maintaining redundant institutions like PPIB only adds inefficiencies and imposes unnecessary financial burdens on consumers.
In a letter to Registrar NEPRA, PALSP has strongly objectrf to the proposed approval of the Private Power & Infrastructure Board (PPIB) annual fee of $250/MW as a pass-through charge to consumers.
Under recent commitments by the Minister of Power and amendments to the NEPRA Power Act, all future power procurement must be conducted through competitive bidding and an auction committee, eliminating the need for PPIB’s involvement. The auction committee will include representatives from ISMO, PPMC, and DISCOs, making PPIB redundant in the procurement process.
PPIB’s role in Competitive Trading Bilateral Contract Market (CTBCM) is unnecessary, adding that the introduction of CTBCM is intended to enhance competition and efficiency in power markets. The presence of an additional entity like PPIB only complicates market operations.
With declining demand and IGCEP already committing to major public-sector projects, PPIB’s involvement in auctions serves no meaningful purpose. Increased centralization through PPIB will further deteriorate DISCOs’ efficiency and hinder market-based procurement.
On the proposed PPIB’s annual fee , PALSP is of the view that it is an unjustifiable burden on consumers who should not be forced to bear the cost of an irrelevant institution.
At $250/MW, the total financial burden amounts to $4.92 million annually, with zero tangible benefit to consumers. The NEPRA Act provides no justification for passing this cost onto consumers.
PALSP is of the view that since KE consumers do not procure power through PPIB, so why should they be forced to bear its costs? Karachi consumers are already unfairly burdened with additional charges such as the Rs. 3.23 per unit PHL surcharge, which stems from DISCO inefficiencies, not their own. NEPRA must provide a clear rationale for why KE consumers should shoulder this unjustified cost.
The Association has proposed that power procurement should be managed by DISCOs, not the PPIB just as KE independently procures its power, all DISCOs should be given full autonomy to source electricity competitively. This process can be supervised by ISMO. Under CTBCM, bilateral contracts will eliminate the need for PPIB’s oversight in procurement.
” NEPRA must stop approving costs for redundant entities as consumers are already burdened by inefficiencies from CPPA, PITC, and PPMC. NEPRA must cease approving unjustified revenue requirements for redundant institutions and take steps toward their dissolution, ” said the Association.
PALS further stated that given the significant changes in power sector, PPIB no longer serves any practical function, therefore, the Association strongly urge NEPRA to reject the proposed PPIB annual fee ($250/MW) as a pass-through charge to consumers, and PPIB be dissolved immediately , as its responsibilities will be absorbed by ISMO and the competitive market framework.
PAPLS has also asked the government to ensure all future power procurement follows a market-driven, competitive bidding process under the auction committee (comprising ISMO, PPMC, and DISCOs), without PPIB’s involvement. DISCOs be empowered with full autonomy over procurement, investments, and governance, eliminating unnecessary oversight from redundant agencies.
” NEPRA must take a decisive stand against inefficiencies rather than enabling them. If NEPRA continues approving such revenue requirements, it will be complicit in unjustly burdening consumers. It is time to phase out wasteful institutions like PPIB and transition toward a more competitive, decentralized, and cost-efficient power sector,” PALSP concluded. Ends
