Nepra asks Sindh Nooriabad Power Company to resubmit COD adjustment plea

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has directed Sindh Nooriabad Power Company (Pvt) Limited (SNPC-I and II) to resubmit the Commercial Operation Date (COD) adjustment application along with all the relevant record in order to proceed further.

According to the decision, SNPC-I and II refer to two gas-based power generation projects of about 50 MW each that sell electricity to K-Electric Limited.

SNPCs are jointly sponsored by Government of Sindh (GoS) and Technomen Kinetics (Pvt.) Limited (TKPL) having share of 49 percent and 51 percent, respectively.

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The Generation Licences to SNPCs were issued by Nepra on July 15, 2015. The reference tariffs of SNPCs were approved by Nepra on June 1, 2016 under the Nepra Interim Power Procurement Regulations, 2005 (IPPR-2005). Motions for leave for review in the matter were decided by Nepra on August 4, 2017. SNPC achieved Commercial Operations Date on January 08, 2018 and SNPC-II on January 23, 2018.

SNPCs, in its letter of November 29, 2019, requested the Authority for adjustment of the project cost and other relevant tariff components in accordance with the determination of August 4, 2017.

The request was reviewed and it was observed that the necessary/ important information/ documents/ evidence have not been provided in support of claimed cost. In this regard, a discussion meeting was held on February 7, 2020 wherein the representatives of SNPCs were directed to provide all the relevant/ necessary information/ data. The application was returned to the Company.

In response SNPCs vide letter dated May 11, 2020 again filed application before the Authority for onetime adjustment at commercial operation date COD (True Up) along with all documents required for the True Up.

The Authority, in its decision June 19, 2020 decided to re-determine/ modify the tariff awarded to SNPCs and initiated separate proceedings in the matter. Since the reference Tariff of SNPC I and II was required to be re-determined; therefore, COD adjustment request was returned to the Company in its letter of November 18, 2020.

SNPC I&II, in its letter of December 16, 2020 filed a motion for leave for review against Nepra’s letter of November 18, 2020. The review motion was admitted by the Authority for consideration. Hearing in the matter was held on March 09, 2021 which was attended by the relevant stakeholders.

According to the decision, the Authority considered the motion for leave for review and noted that the submission of the petitioner does have merit. Accordingly, SNPC I & II were directed to resubmit the COD True-up application along with all the requisite supporting details and documents, where upon the same would be processed in accordance with law.

The Authority directed SNPC I&II to resubmit the COD adjustment application along with all the relevant records in order to proceed further. Rafique Ahmad Shaikh, Member (Technical) who retired from Nepra on December 5, 2025 after completion of his two terms as Member (Sindh) said that the SNPC and SNPC-I power projects, developed under a Public-Private Partnership (PPP) framework, play an important strategic role. By utilising indigenous gas, they have provided meaningful relief to KE’s generation basket. However, the project has faced significant challenges since its inception.

He said, initially, CPPA-G had been identified as the intended off-taker, but this arrangement was subsequently withdrawn. The project company then commenced negotiations with KE for the sale of electricity; however, additional bottlenecks emerged. These issues ultimately necessitated the construction of a dedicated transmission line by the Government of Sindh through STDC. Despite these obstacles, the Authority extended consistent regulatory support, including grant of licenses and determination of Tariffs, enabling the projects to achieve COD.

Following COD, the company experienced further hardship due to a NAB inquiry, which, inter alia, resulted in the withholding of its Return on Equity (RoE) and imposed substantial strain on project cash flows.

Subsequently, NAB filed application before the Accountability Court, Islamabad, for withdrawal of the reference, where it is, inter-alia, explicitly acknowledged that there was no convincing or reliable material on record to hold that the projects were over-valued and that no standard formula existed for comparison and to declare the projects over-valued. With these findings now on record, the prolonged legal, contractual, and regulatory delays warrant urgent redress to preserve the project’s status as a going concern.

He said, given the project’s strategic importance and its PPP structure, it is hoped that the Authority accords priority to resolving the remaining outstanding matters in respect of SNPC and SNPC-I, specifically: (i) release of the pending RoE; (ii) expeditious processing of the COD adjustment case upon its resubmission to Nepra; and (iii) timely processing of the tariff modification petition to allow recovery of legitimate costs. Immediate action is essential not only to ensure the company’s financial sustainability, but also to safeguard the provincial exchequer and support the province’s broader energy security objectives.

Copyright Business Recorder, 2025