Govt launches 400MW auction under competitive power market

Pakistan has launched its first Wheeling Auction by issuing the Request for Proposals (RFP), marking a major step towards shifting the electricity market from a single-buyer model to a competitive wholesale electricity system.

The initiative is being undertaken under the Competitive Trading Bilateral Contract Market (CTBCM), according to the Ministry of Energy (Power Division).

Under the Wheeling Auction Guidelines 2025, a total of 800 megawatts (MW) will be auctioned over the next five years, with 400MW being offered in the first auction.

The auction will allow eligible participants to access the national transmission and distribution network and engage in bilateral electricity transactions in the competitive market.

The auction process will comprise five steps: issuance of auction documents, evaluation of eligibility, evaluation of bids, approval of auction results, and award of quantum.

Federal Minister for Energy (Power Division) Sardar Awais Ahmad Khan Leghari said the objective of transforming Pakistan’s electricity procurement system into a competitive market had remained under consideration for three decades.

He said the government had now moved beyond policy commitments and initiated practical implementation, adding that the first Wheeling Auction would enable electricity producers and large consumers to buy and sell electricity directly through a transparent mechanism.

According to the minister, consumers using more than one megawatt of electricity would benefit in the initial phase, while the benefits of the competitive system would gradually extend to general consumers.

He said access to relatively cheaper electricity on a competitive basis would provide industries with opportunities to reduce production costs, improve competitiveness in international markets and increase exports.

Leghari said issuance of the RFP was an important step towards establishing a transparent and credible Wheeling Auction process, with all stages from eligibility evaluation to award of quantum clearly defined.

The entire process will be conducted through a dedicated auction platform, the ministry said.

In line with the minister’s directions, the Independent System and Market Operator (ISMO) has invited eligible participants to take part in the process and will provide guidance materials and other supporting resources.

ISMO will also release a series of explainer videos to help participants understand the auction procedure, proposal submission requirements and use of the auction platform.

The RFP contains eligibility criteria, proposal submission requirements, prescribed formats, auction procedures and the complete timeline.

The ministry said the RFP and related documents are available on ISMO’s website.