Key Takeaways
- Nepra approved the ISP 2025, a $58bn 11-year plan for Pakistan’s power sector.
- Three Nepra members wrote dissenting notes, questioning the plan’s exclusions and bypassing the CCI.
- The plan includes capacity addition of 26,045MW and transmission investments of $10.65bn.
The National Electric Power Regulatory Authority (Nepra) has approved the Integrated System Plan (ISP) 2025, a 11-year plan for Pakistan’s power sector, despite reservations from Nepra members. The plan, which involves a total investment of $58 billion, is aimed at addressing the country’s energy needs over the next decade.
In a controversial decision, Nepra approved the plan, subject to addressing the concerns raised by the three members, including the Nepra chairman. The dissenting notes, which span over 12 pages, question the grounds for the exclusion and inclusion of major projects and the bypassing of the Council of Common Interests (CCI), a constitutional forum dealing with national energy policy and planning.
The ISP 2025 considers three principal demand forecast scenarios: high growth, medium growth, and low growth. The low-growth, or business-as-usual, scenario, based on the Rationalised Capacity Addition (RCA) assumption, was adopted as the reference case for generation expansion planning. This scenario envisages capacity addition of 26,045MW, with 17,485MW committed and 8,560MW optimised, along with the retirement of 2,577MW of existing capacity, resulting in a total installed capacity of 62,657MW.
The total projected cost of the additional capacity is $47.08 billion, while ongoing or committed transmission projects entail an estimated investment requirement of $4.6 billion. Additionally, newly proposed transmission expansion projects require an additional investment of approximately $6.05 billion, resulting in a cumulative transmission investment requirement of approximately $10.65 billion over the planning horizon.
The plan also includes power evacuation schemes, transmission system reinforcements, construction of new extra high voltage substations, transformer augmentations, and voltage control facilities. In view of the geopolitical conflict between Iran and the US, which disrupts electricity imports from Iran, the plan provides for the lateral entry of a 40MW on-site power plant for the Gwadar and Makran region, where extending the national grid is currently considered neither technically nor economically feasible.
K-Electric’s highly competitive renewable energy projects, which had been excluded from the ISP by the Independent System and Market Operator (ISMO), were later included in the plan. The decision by Nepra to approve the plan, despite the dissenting views, highlights the ongoing debate and challenges in Pakistan’s energy sector.
The approval of the ISP 2025 is a significant step towards addressing Pakistan’s energy crisis, but it remains to be seen how the concerns raised by Nepra members will be addressed and whether the plan will be implemented effectively.
The approval of the ISP 2025 is a critical milestone in Pakistan’s energy planning, but it comes with significant challenges and reservations. The plan’s success will depend on addressing the concerns raised and ensuring its effective implementation.
