ISLAMABAD: The Power Division has prepared draft of electricity wheeling auction process under the Competitive Trading Bilateral Contract Market (CTBCM) to be discussed at a workshop of stakeholders to be held here on September 19, 2025.
The auction process is being issued under Clause 3.2 of the Framework Guidelines for Wheeling Auctions, 2025, to outline instructions for conducting auctions.
According to Power Division, the ISMO will publish an auction calendar each year. The calendar will outline the timelines for each stage of the auction from the publication of the auction calendar to bid award.
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The auction will be held on the date specified in the Auction Calendar. Any change in the Auction date will only be made to accommodate unforeseen or unavoidable circumstances, and sufficient notice of change will be provided to Eligible Auction Participants.
A Request for Proposal (RFP) will be published on the ISMO website within [insert months] of the publication of the Auction Calendar, inviting prospective Auction Participants to submit proposals to the ISMO.
In case more than one Auction is to be conducted in a single year, the timelines and modalities will be decided by the Auction Committee. For this purpose, the Auction Committee will issue a supplementary auction calendar in advance. Auction Participants will follow a two-step process to participate in an Auction.
Step 1: submission of a proposal by auction participants in response to the RFP, including all documents and information required for evaluating an auction participant’s eligibility to participate in bidding according to the eligibility criteria provided in the guidelines and the RFP.
Step 2: Submission of bid values by auction participants declared ‘eligible’, following the outcome of Step 1.
Auction participants will be required to furnish a bid bond with their bids, in the form and manner specified in the RFP. Additionally, the ISMO reserves the right to encash the Bid Bond if the auction participant withdraws the bid during the bid validity period, or is found to have violated any of the provision of the guidelines, the RFP or the applicable documents, or declines to sign the letter of award when the bid is accepted.
Once a bid has been accepted, the bid bond of successful auction participants will remain valid until the submission of the performance guarantee. The bid bond will be returned once a successful auction participant submits a performance guarantee that is valid until the transaction start date specified in the proposal.
Bid bonds will be returned to all auction participants that are not successful in the auction or if the bidding process is scrapped.
Proposals received in response to the RFP will be evaluated by an Auction Committee that will determine the eligibility of each Auction Participant. A provisional list of Eligible Auction Participants will be published on the ISMO website within two weeks of the last date for submission of proposals.
A four-week grievance redressal period will be allowed following the publication of the provisional list during which Auction Participants will be given one week from the date of publication of the provisional list to file grievances (if any).
The Auction Committee will resolve all grievances within four (04) weeks of publication of the provisional results and before the end of eligibility evaluation period, as specified in the Auction Calendar. The decision of the Auction Committee regarding the final eligibility of an Auction Participant will be final and binding.
Auction participants declared ‘eligible’ through the process described in Section 3 (the Eligible Auction Participants) shall be invited to submit their respective Bid Values against their specified bid quantum through both an online electronic auction platform managed by the ISMO and in hard-copy. For online submissions, eligibleauction participants will be provided with a secure log-in identification and password to use on the electronic auction platform.
Eligible auction participants will be invited to attend the auction in-person and bids will be opened in the presence of the eligible auction participants or their authorized representatives. There will be no predetermined upper or lower limit (cap or floor) on the bid value. The allocation of the auction quantum to eligible auction participants will be based on bid values sorted in descending order, until the auction quantum is fully allocated.
In case of under-subscription (i.e. the cumulative bid quantum of all eligible auction participants is less than the auction quantum), all bids will stand accepted. The unallocated portion of the auction quantum will be allocated through one or more subsequent auction(s) during the same year or through an annual auction in a subsequent year, as decided by the Auction Committee.
In case the auction is over-subscribed (i.e. the cumulative bid quantum of all eligible auction participants is greater than the auction quantum), the following process will be followed:(i) in case multiple eligible auction participants have submitted the same bid values and the requested bid quantum is greater than the available quantum, additional rounds of bidding will be conducted during the same auction, in order to raise the bid price until the winning bids match the auction quantum;(ii) in case the auction quantum available for allocation to the last eligible auction participant on the list of successful auction participants is less than the quantum requested by such eligible auction participant, the eligible auction participant will be awarded the available quantum; and (iii) in any case, if the quantum awarded to an eligible auction participant is less than the quantum requested, the eligible auction participant will have the option to reject the allocation at the time of award without any financial implications. Any quantum made available by this rejection will be offered to the next eligible auction participant on the list of successful auction participants.
The auction committee will formulate the bid evaluation report, sorting bids in a descending order of bid Value, and submit the report to the ISMO for approval. The bid evaluation report will be submitted by the ISMO to NEPRA for approval within two weeks of the date of the auction.
On approval from NEPRA, the charges payable by successful auction participants (i.e. the bid value) shall be notified in the official Gazette. The ISMO will award the bid quantum to successful auction participants and publish the results on the ISMO website within one week of approval by the Authority.
Copyright Business Recorder, 2025
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