ISLAMABAD: Pakistan is set to finalise its first 200-megawatt (MW) electricity transaction through a competitive wheeling auction by June, marking a significant step toward a market-driven power sector, Federal Minister for Power Sardar Awais Ahmed Khan Leghari said on Tuesday.
Speaking at a ceremony, the minister confirmed that a summary seeking approval to launch the auction under the newly operational Competitive Market Operations Date (CMOD) regime has been sent to the prime minister.
Under the proposed mechanism, buyers for up to 200MW of electricity will be determined in the first phase through a competitive process managed by the Independent System and Market Operator (ISMO).
Leghari revealed that the government plans to auction a total of 800MW of electricity through the wheeling framework during the current year, reflecting an accelerated push toward competitive market reforms that were first envisioned in the early 1990s but faced repeated delays.
The wheeling model will allow large power consumers to directly sign agreements with power producers, bypassing the traditional single-buyer system. Instead of purchasing electricity solely through the central power purchaser, eligible consumers will procure power directly from generators while paying a network usage charge to state-owned transmission and distribution companies for access to the grid.
The minister described the operationalisation of CMOD as a “major milestone” in restructuring Pakistan’s electricity market. He acknowledged that certain regulatory matters, including the final determination of wheeling charges, are still under review. However, he expressed confidence that auction-based transactions would commence after April, leading to the completion of the first 200MW deal by June.
According to officials, the government aims to promote competitive bilateral contracts in the electricity market to enhance efficiency, transparency and cost optimisation in the power sector.
The transition toward wheeling and competitive trading is expected to gradually shift Pakistan’s electricity market from a centralised purchasing model to a more open and market-oriented system.
