NEPRA approves KAPCO’s tripartite power agreement

The National Electric Power Regulatory Authority (NEPRA) has approved a tripartite agreement between Central Power Purchasing Agency (Guarantee) Limited (CPPA-G), Kot Addu Power Company Limited (KAPCO) and National Grid Company of Pakistan Limited that will govern electricity sales from KAPCO’s power plant.

KAPCO disclosed the development in a notice to the Pakistan Stock Exchange (PSX) on Tuesday.

“We are pleased to advise that the NEPRA vide letter dated May 19, 2025 addressed to the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G) has granted approval of the TriPartite Power Purchase Agreement (TPPA) between the CPPA-G, KAPCO and National Grid Company of Pakistan Limited along with the schedules,” read the notice.

However, before the TPPA can officially become effective, certain conditions set by NEPRA must be met, the listed company said.

“The directions of NEPRA as stipulated in its letter dated May 19, 2025 are to be complied with for signing of the TPPA, which, inter alia, include the conduct of Initial Capacity Test (ICT) and the Heat Rate Test (HRT) for bench marking efficiency and an independent engineer is to evaluate and determine Simple Cycle Efficiency/Heat Rate numbers which are to be submitted before NEPRA along with ICT and HRT Reports.”

Once these requirements are met, the TPPA will become effective for the operational phase of the power plant, KAPCO said.

Last month, NEPRA granted a provisional tariff to KAPCO on a Take-or-Pay basis after a hectic debate at a public hearing on April 8, 2025.

Incorporated in Pakistan on April 25, 1996, as a public limited company, KAPCO’s principal activities are to own, operate and maintain a multi-fuel fired power station with fifteen generating units with a nameplate capacity of 1,600 MW in Kot Addu, Punjab.

The company sell the electricity produced to a single customer, the Water and Power Development Authority (WAPDA) under a Power Purchase Agreement (PPA).