Pakistan has taken a major step towards shifting its power sector from the traditional single-buyer model to a competitive electricity market, with the government initiating the country’s first electricity wheeling auction.
Federal Minister for Power Sardar Awais Ahmad Khan Leghari said in a video message that the new system would initially target industrial and large consumers, particularly those using more than one megawatt. Under the Competitive Trading Bilateral Contract Market (CTBCM), eligible businesses and industrial consumers will be able to purchase electricity directly from power producers on a competitive basis.
The minister said the government currently purchases electricity from producers and supplies it to consumers through a centralised system. Under the emerging market structure, electricity producers and consumers will be able to enter into direct transactions, while electricity trading will be conducted through a transparent and competitive mechanism.
The Power Division has issued a Request for Proposals (RFP) for the first wheeling auction, under which 800 megawatts of electricity are planned to be auctioned over the next five years. The first phase will offer 400MW for competitive procurement.
Leghari said the competitive market would gradually expand, giving consumers greater choice and potentially helping industries secure electricity at competitive rates. He said lower-cost power could help reduce production expenses, improve the international competitiveness of Pakistani industries and support higher exports.
The auction will follow a five-stage process: issuance of auction documents, eligibility evaluation, bid evaluation, approval of results and award of quantum. The process will be conducted through a dedicated auction platform.
The Independent System and Market Operator (ISMO) has invited eligible participants to take part in the auction and will provide guidance on the procedure, proposal requirements and use of the platform. ISMO will also issue explainer videos to assist participants.
The RFP contains eligibility criteria, submission requirements, prescribed formats, auction procedures and timelines. Interested participants can access the documents through ISMO’s website and submit queries for clarification through the designated auction contact. – ERMD
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