KAPCO resumes power generation as NEPRA clears tariff hurdles
- The plant had been offline since October 1 due to tariff limitations
Kot Addu Power Company Limited (KAPCO) has resumed supplying electricity to the national grid after more than two months, following a decision by the National Electric Power Regulatory Authority (NEPRA) to provisionally extend its tariff period, according to a press release.
The plant had been offline since October 1 due to tariff limitations arising from the Indicative Generation Capacity Expansion Plan (IGCEP) and Power Acquisition Programme (PAP).
NEPRA’s determination, issued on December 9, removes these constraints and allows immediate restoration of KAPCO’s 495MW gas/RLNG and 478MW LSFO-based generation capacity.
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The regulator acted after detailed submissions from the Independent System and Market Operator (ISMO), National Grid Company of Pakistan Limited (NGC), Multan Electric Power Company (MEPCO), Central Power Purchasing Agency-Guarantee (CPPA-G) and the Ministry of Energy.
All stakeholders cautioned that the prolonged suspension was affecting system stability, congestion management around Multan and Muzaffargarh, and reliable supply to 13 MEPCO grids.
NEPRA noted that despite plans under the IGCEP framework, transmission constraints necessitate continued availability of KAPCO. The plant has also been included in the draft IGCEP 2025–35 for this reason.
Under the latest decision, KAPCO will operate under its existing tariff terms until finalisation of the IGCEP or for up to three years, as allowed in the Tripartite Power Purchase Agreement.
The ruling also settles several clarifications sought by the company. NEPRA corrected a typographical error in the variable O&M components of the earlier tariff determination—revising the table to reflect block-wise calculations instead of fuel-wise differentiation. The regulator upheld its position on switchyard charges and maintained the established methodology for working capital costs.
Industry officials say KAPCO’s return enhances supply reliability across southern Punjab and restores a key Black Start–capable facility to the system.
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