ISLAMABAD: The World Bank (WB) has reportedly raised concerns over proposed amendments to the Nepra Act, 1997, and the Electricity Act, 1910, which may compromise the independence of the National Electric Power Regulatory Authority (Nepra), well-informed sources told Business Recorder.
Under the proposed changes, the term “Federal Government” is being replaced with “Power Division” or “division concerned” for the approval of various regulatory proposals. On Sunday, in a rare development, sitting Power Minister Sardar Awais Ahmad Khan Leghari publicly rebutted figures presented in Nepra’s State of Industry Report 2024–25.
“The World Bank has held one meeting with the concerned authorities and conveyed its concerns regarding the proposed replacement of the term ‘Federal Government’ with Division’. Another meeting is expected in the coming days,” the sources added.
The country’s business community and industrial sector have also expressed serious concerns over the Power Division’s move, warning that it could force the regulator to compromise its independence.
According to sources, Prime Minister Shehbaz Sharif has also taken notice of the Power Division’s move regarding amendments to the Nepra Act.
“The prime minister has directed the Power minister to discuss the matter with him,” the sources quoted the PM Office as saying.
Section 3(a) of the Act empowers the Authority to determine tariffs, rates, charges, and other terms and conditions for the supply of electric power services by generation, transmission, and distribution companies, and to recommend these to the relevant division for notification.
Under the revised Section 31(7), notification of Nepra-approved tariffs or uniform tariffs — along with rates, charges, and other terms and conditions for the supply of electric power services—shall be made in the official Gazette by the division concerned within 30 days of intimation by the Authority.
READ MORE: Nepra approves uniform national average tariff, ignoring industry and export sector concerns
If the division fails to notify the tariff or refer the matter back to Nepra for reconsideration within the specified timeframe, the Authority may direct immediate application of its approved tariff through notification, subject to any subsequent adjustments arising from reconsideration requested by the Division.
Section 31(7)(i) provides that the division concerned may, within 30 days of receiving Nepra’s intimation regarding approved tariffs of public-sector distribution and supply licensees, require the Authority to reconsider its determination on issues common to these licensees. The Nepra would then be required to complete the reconsideration within 30 days and inform the division accordingly.
Under Section 31(7)(ii), the Nepra may make quarterly tariff adjustments within 15 days on account of capacity and transmission charges, transmission and distribution losses, variable operation and maintenance costs, and policy guidelines issued by the division concerned.
The adjusted tariff would be intimated to the division prior to Gazette notification. The division may seek reconsideration within 15 days, failing which Nepra shall notify the adjusted tariff in the official Gazette. If reconsideration is sought, the Nepra must decide the matter within 15 days and intimate the division before notification.
Section 31(7)(iii) allows the division concerned, in lieu of seeking reconsideration, to file an appeal. However, once a reconsideration request is filed, the Power Division will not be entitled to subsequently appeal the decision on that reconsideration. No changes have been proposed to Section 31(7)(iv).
Similarly, amendments have been proposed to the Electricity Act, 1910, replacing the term “Federal Government” with “appropriate authority” or “division concerned.”
Under the revised Section 32(2), any dispute between an operator and the telegraph authority regarding the placement or operation of electric supply lines shall be referred to the division concerned, which may direct the operator to make necessary alterations to comply with the law. Amendments to Section 53(1)(a) relate to the service of notices, orders, or documents, stipulating that where the addressee is the Federal or Provincial Government, such service shall be made at the office designated by the division concerned.
Business Recorder sent few questions to Power Division. Questions and their response are as follows
- What is the main purpose of these amendments?
The primary purpose of the proposed amendments is to remove procedural difficulties and avoid unnecessary administrative delays. Following the Mustafa Impex judgment, the Federal Cabinet directed all ministries to review existing laws, rules, and regulations to ensure that routine and technical matters are not escalated to the Cabinet where such escalation is not required. Accordingly, the amendments mainly replace the term “Federal Government” with “concerned Division” in limited procedural contexts to streamline filings, notifications, and technical reviews, without altering the substantive regulatory framework.
- Will these amendments make Nepra a subordinate body of the Power Division?
No. This understanding is incorrect. The amendments do not make Nepra subordinate to the Power Division in any manner. The Nepra remains an independent statutory regulator, administratively reporting to the Federal Cabinet. No changes have been proposed that require amendments to the Rules of Business or that alter Nepra’s legal status, independence, or quasi-judicial authority. The amendments are strictly administrative and do not interfere with Nepra’s core regulatory mandate.
- Will the amendments allow the Power Division to issue directions without formal approval from the Federal Cabinet?
No. Wherever policy decisions or policy directions are involved, the term “Federal Government” has been consciously retained in the law. At no place do the proposed amendments authorise the Power Division to issue policy directions independently or bypass the Federal Cabinet. The scope of the changes is limited to procedural and technical matters only.
- When are these amendments expected to be tabled before the House?
The Federal Cabinet has approved the draft set of proposed amendments. Following this, the draft legislation will undergo due legal vetting and finalisation. Once completed, the bill will be submitted to Parliament through the Parliamentary Affairs Division, in accordance with the prescribed legislative process.
Copyright Business Recorder, 2026
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