Lahore: November 12, 2010
1

As per Section 7(1) and (2) of NEPRA Act, the Authority shall be exclusively responsible for:
 Grant Licenses for Generation, Transmission &
Distribution of electric power;
 Prescribe procedure and standards for investment programs by Generation, Transmission and Distribution
Companies;
 Prescribe and enforce performance standards for
Generation, Transmission and Distribution Companies;
 Establish a uniform system of accounts by Generation,
Transmission and Distribution Companies;
 Prescribe fee including fees for grant of licenses and renewal thereof;
2

Contd…
 Prescribe fines for contravention of the provisions of this
Act;
 Perform any other function which is incidental or consequential to any of the aforesaid function.
As per Section 7(3) of NEPRA Act, the Authority shall:
 Determine tariff, rates, charges and other terms and conditions for supply of electric power services by the
Generation, Transmission and Distribution Companies and recommend to the Federal Government for notification;
3

Regulation of Generation, Transmission and Distribution of
Electric Power Act (XL of 1997): to regulate generation, transmission and distribution of electric power.
Application Modification Procedure Regulations, 1999 : to standardize the manner for submitting applications and filing petitions to NEPRA.
Licensing Generation Rules, 2000 : to streamline the process for becoming a licensee under NEPRA Act.
Tariff Standards Procedure Rules, 1998 & Fees Pertaining to Tariff Standards & Procedure Regulations, 2002 : to highlight the procedure of tariff determination and standards to be adopted.
4

Contd…
National Electric Power Regulatory Authority Licensing
(Distribution) Rules, 1999 & Eligibility Criteria for Consumers of
(Distribution) Companies, 2003 : to regulate the process of acquiring licenses by distribution companies.
Interim Power Procurement (Procedures and Standards)
Regulation, 2005 : to streamline the manner for acquiring permission for sale of power to transmission and distribution companies.
Performance Standards (Distribution) Rules, 2005 : to provide standards of performance for distribution companies.
Performance Standards (Transmission) Rules, 2005 : to provide the standards of Performance for transmission companies.
NEPRA Uniform System of Accounts Rules, 2009 .
5

NEPRA determines tariffs for the three sectors namely
Generation, Transmission and Distribution:
 Under Section 7 (3) (a) of the Regulation of Generation,
Transmission and Distribution of Electric Power Act (XL of 1997) NEPRA is exclusively responsible to determine tariff, rates, charges and other terms and conditions for supply of electric power services by the Generation,
Transmission and Distribution Companies and recommend to the Federal Government for notification.
 Discharging its responsibilities under Act, NEPRA has to determine/approve Tariff in respect of Generation,
Transmission and Distribution Companies.
6

Contd…
Currently NEPRA’s determinations include:
 Quarterly determination in respect of 9 Distribution Companies including KESC.
 Monthly Fuel Price Adjustment in respect of 9 Distribution
Companies including KESC.
 Generation Tariff determinations in respect of Public Sector
Generation Companies, IPPs, WAPDA Hydel etc.
 Tariff determination in respect of NTDC.
 Fortnightly Fuel Price Adjustments in respect of GENCOs,
IPPs etc.
 Adjustment of determined generation tariff of IPP at COD.
During 2009-10, the Authority made 311 determinations/adjustment regarding tariff of generation and distribution companies. These included 41 tariff determinations, 3 decisions on review motions and
267 tariff adjustments in respect of Fuel Price, CPI, COD, tax and quarterly indexation.
7

ST
 All statutory requirements have been complete for all
DISCOs and KESC.
 Forms the basis for the remaining quarters of the year as
Key parameters are required to be set
 Policy questions have to be addressed
Tariff rationalization, Subsidy and cross subsidy
 Experts appointed by the USAID were specifically tasked by NEPRA to provide inputs on the Cost of Service Study for different DISCOs.
8

 Review of the performance of DISCOs during 2009-10
 Determination of 4 th Quarter, 2009-10
FESCO
QESCO
8 September, 2010
8 September, 2010
GEPCO
HESCO
8 September, 2010
9 September, 2010
IESCO
LESCO
MEPCO
PESCO
9 September, 2010
8 September, 2010
18 October, 2010
20 October, 2010
9

ST
Contd…
 Determinations for all DISCOs and KESC for Q1 2010-11 will be made during November and early December, 2010.
 Relevance of Ordinance # XIV dated 20 April, 2010 and tariff determination for the remaining period of 2010-11
 Difficulties in quarterly determinations -NEPRA’s views
 All participatory and transparency requirements under the
NEPRA laws also need to be satisfied for quarterly determinations. Court binds to conduct hearing for decision on Monthly adjustments.
10

 NTDC Tariff was determined in 2007.
 NTDC filed tariff petition subsequent to a series of NEPRA letters. NTDC requested for extensions in time on different pretexts.
 Hearing was held in October 2010, however it was adjourned due to information requirement from NTDC.
 Major issues concern about losses in the transmission system.
 Determination expected by February, 2011.
11

Subsequent to the directions of the Planning Commission:
• GENCO-I (JPCL): Multiyear tariff, Control Period up to 2014.
• GENCO-II (CPGCL):
Letter about the need for a multiyear tariff up to 2014 along with direction to file Tariff Petition sent on 18 August, 2010.
• Reminder to the above letter sent on 17 September, 2010.
• Response by CPGCL on 1 October, 2010 requesting for extension in time.
• Authority granted extension till 20 October and informed that on failure, suo-moto proceedings will be initiated.
• CPGCL requested for further extension on 20 October,
2010.
12

Contd…
 GENCO-III (NPGCL):
Letter about the need for a multiyear tariff up to 2014 along with direction to file Tariff Petition sent on 18 August,
2010.
 Reminder to the above letter sent on 17 September, 2010.
 Response by NPGCL on 1 October, 2010 requesting for extension in time.
 Authority granted extension till 20 October and informed that on failure, suo-moto proceedings will be initiated
 CPGCL requested for further extension on 18 October,
2010.
13

Contd…
 GENCO-IV (LPGCL):
Letter about the need for a multiyear tariff up to 2014 along with direction to file Tariff Petition sent on 18 August,
2010.
 Reminder to the above letter sent on 17 September, 2010
 Response by LPGCL on 22 September, 2010 requesting for extension in time.
 Authority granted extension till 20 October and informed that on failure, suo-moto proceedings will be initiated
 LPGCL Filed on 18 October, 2010.
 After completion of information requirements (Board
Resolution) received in November It will be placed for admission shortly.
14

Contd…
 Heat Rate tests also needed to work out tariffs under the present state of plant and equipment.
 Capacity tests are critical.
 GENCOs’ unwilling response is not helpful, possibility of unrealistic tariffs being passed to the consumers. The
Planning Commission may take notice.
15

NEPRA has established a division headed by a Director
General and supported by Director for the monitoring of the performance of the sector.
Monitoring of the sector is being conducted in the following modes:
 Monitoring pursuant to Performance Standards
 Monitoring pursuant to Authority Determinations
 Monitoring on need
Monitoring Activities:



Monitoring of Generation Companies (IPPs) at COD
Monitoring of Distribution Companies
Monitoring of Generation Companies including
Public Sector GENCOs
16

A team headed by Director (Thermal) Inspects the IPPs at the time of
COD for verification of their technical, financial and legal aspects.
FUNCTIONS OF MONITORING TEAM:
 To observe the tests like RRT, IDC HRT etc. carried out at the time of
COD as per the guidelines provided in the test Protocols, Power
Purchase Agreement and International Engineering Codes.
 To carryout physical verification of existence and reasonableness of various claims allowed in the Tariff determination such as, Generation facility equipments, electro-mechanical and civil works construction etc.
 List of IPPs visited:
Attock Gen Limited
Atlas Power Limited
165 MW
224 MW
24 April, 2009
15 December, 2009
Engro Energy Limited
Saif Power Limited
Orient Power Limited
Nishat Power Limited
Nishat Chunian Limited
226 MW
231 MW
225 MW
202 MW
202 MW
23 March, 2010
23 April, 2010
20 May, 2010
4 June, 2010
16 July, 2010 17

 Special Audit have been commissioned by NEPRA for
MEPCO.
 NEPRA Team lead by Director General carried out evaluation of HESCO losses.
 NEPRA Team lead by Director General carried out inquiry about KESC operations during black out of the system.
 Financial Audits have been carried out to verify CPPA purchases from IPPs and GENCOs.
 Evaluation of calorific values of the Fuel.
18

In exercise of the powers conferred by Section 46 of the
Regulation of Generation, Transmission and Distribution of electric Power Act, 1997 read with Section 34 thereof,
National Electric Power Regulatory Authority, with the approval of the Federal Government has prescribed and notified:
 Performance Standards (Distribution) Rules, 2005 notified in 11 th January, 2005.
 Performance Standards (Transmission) Rules, 2005 notified on 15 th November, 2005.
 Performance Standards (Generation) Rules, 2009 notified on 17 th November, 2009.
19

• Performance Standards are designed to encourage safe, efficient and reliable service, including standards for service characteristics such as voltage and stability as well as scheduled and unscheduled outages.
• Under Performance Standards (Distribution) Rules, 2005 distribution companies are required to maintain a prescribed overall systems in term of electric reliability, voltage and frequency of power supply. The standards include:
― Power supply restoration time (Hrs).
― Annual number and duration of individual consumer power supply interruptions.
― Voltage range of + 5% and frequency range + 1% from nominal voltage and frequency of power supply at the consumer supply terminals.
― Time limits for new connections categorized based on size of the load and voltage level.
― Electric safety standards.
― Non-discriminatory principles and priorities of load shedding to be followed by the distribution companies.
• Rules are enforced through Licenses under which periodic reporting is required by Licensees.
20

 NEPRA has held various meetings with DISCOs to educate them about APRs.
 Considering DISCOs weak understanding about APRs, the
Standards Division has held a special campaign of workshops at each DISCO Head Quarter to closely interact with them for their enhanced understanding about implementation of Performance Standards (Distribution)
Rules, 2005. The team comprising of DG (Stds.) and other professionals has visited all DISCO Head Quarters and delivered presentations to educate their engineers up to
SDO level.
21

• The Performance Standards (Generation) Rules, 2009 have been formulated with to ensure that the Electric Generation Facilities and Power Plants are operated efficiently, and to ensure Electrical Service Reliability and
Adequacy for the Transmission and Distribution Service Providers within
Prescribed Parameters
•
Reporting requirements are:-
1.
For Overall Standards with regard to Quality of Supply, the Licensee shall supply compliance report every year to the Authority, before 31 st
of
October, for the preceding year
2.
Reports required for the Key Performance Indicators (KPI) shall be submitted on a quarterly basis.
3.
The Generation companies have been asked to submit reports regarding compliance with PSGR.
4.
The received APRs are being processed by Standard Division for their presentation to the Authority.
22

 Director (Thermal) of NEPRA monitors the availability of power plants.
 Data is obtained from NTDC and KESC to ascertain the daily load position of their systems.
 Comprehensive technical data is obtained on monthly and annual basis on E.form to monitor the efficiency of the power plants.
23

 As per Performance Standards (Transmission) Rules, 2005, the Licensee is required to submit to the Authority every year, before the 31 st of March of the succeeding year, an Annual Performance Report (APR) containing all relevant Information with respect to Compliance with these Rules during the
Year including a Statement of Comparison with the Last APR submitted
 The Standards Division is responsible to obtain and analyse the APRs from
Transmission companies.
APR of NTDC for YEAR 2009
 Have been analyzed and
 Meeting with Senior Officers of NTDC held on 4 th March, 2010.
 Requirement of System Expansion as per Grid Code PC 4.6, was also discussed during the meeting.
APR of KESC for YEAR 2009
 Senior Officers of KESC held meeting on 3 rd February, 2010.
 Purpose was to guide KESC for proper compliance of PSTR and understanding Proformas.
 KESC agreed to provide the APR as per PSTR after the issuance of License.
24

25

 NEPRA pursuant to Section 39 of the Act, deals with complaints by any interested person against a licensee for violation of its rules, regulations and orders.
 Pursuant to Section 21(2) (b) of the Act, NEPRA has issued
Regulations for Eligibility Criteria for Consumers for non discriminatory provision of distribution services and sale of electric power.
 Consumer Service Manual in respect of 9 distribution companies was approved and circulated to all DISCOs for implementation.
 Complaint Handling and Dispute Resolution Procedure
Rules, 2009 is under review and will be sent to Federal
Government shortly for approval and notification.
 Since creation of a Consumer Affairs Division in 2002,
NEPRA received 5,553 complaints, out of which 5,326 were resolved.
26

Year
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Complaints
Received
76
187
237
354
1098
548
503
469
663
1418
Complaints Addressed through Provincial Offices of Inspection/DISCOs
76
172
225
325
1025
527
503
469
654
1350
27