Energy Regulations in Pakistan: Recent Developments

Energy: Sustainable Access for All

World Consumer Rights Day-March 2006

Muhammad Aftab Alam Consumer Rights Commission of Pakistan

1

Energy Regulations-An Introduction

Consumers and Energy Sector Regulation Past: Public Sector Monopolies like WAPDA, KESC, SNGPL, and SSGCL Legal and Infrastructural Reforms in Power Sector during 1990s Inclusion of Independent Power Producers (IPPs) Unbundling of big state-owned monopolies

Energy Regulations-New Regime

National Electric Power Regulatory Authority (NEPRA) 1997 Natural Gas Regulatory Authority (NGRA), 2001 Oil and Gas Regulatory Authority (OGRA), 2002 De-regulation of Petroleum Prices

NEPRA

Mission Statement

ensures the provision of safe, reliable, efficient and affordable electric power to the electricity consumers of Pakistan

Section 7 (6) of the NEPRA Act, 1997 the Authority shall, as far as practicable, protect
the interests of consumers

OGRA

Mission Statement

Protect the Public interest while respecting Individual Rights by ensuring Effective, Efficient and Equitable Regulatory Environment.

Section 6 (2Q) of OGRA Ordinance, 2002 Protect the Public interest while respecting
Individual Rights by ensuring Effective, Efficient and Equitable Regulatory Environment.

Functions of Regulators

Licensing Tariff Determination Performance Standards of Utilities Complaints against the Utilities

Public Hearing
Transparency and Openness
6

Issues in Regulations
Autonomous and Independent Regulators Internal Issues: Lack of ownership by the sector External Issues: Pressure from the investors for weak regulations Government Interventions Policy Guidelines or Policy Directives

Policy Guidelines for Regulators

Guidelines of Federal Government: NEPRA Section 7: Powers and functions of the Authority (6) In performing its functions under this Act, the Authority shall, as far as practicable, protect the interests of consumers and companies providing electric power services in accordance with guidelines, not inconsistent with the provisions of this Act, laid down by the Federal Government.
8

Policy Guidelines for Regulators (Contd.) Guidelines of Federal Government: OGRA Section 21: Power of Federal Government to Issue Policy Guidelines

The Federal Government may issue policy guidelines on the matters of policy not inconsistent with the provision of this Ordinance
9

Recent Developments: NEPRA

New IPPs Regime: 47 new power generation companies Guidelines for Determination of Tariff for IPPs (November 2005, Ministry of Water and Power) 1.2 (a) NEPRA should now determine an up-front tariff [for IIPs without any public consultation] Proposed NEPRA Amendments without Public Consultation-proposed draft not made public

10

Recent Developments: OGRA

Amendments in OGRA Ordinance [no public consultation] Recent Cabinet Decision on Determination of Petroleum Prices Issues
Preparation of Regulations/Rules to determine the Petroleum Prices [after consulting all stakeholders] Public representation/participation in prices determination Transparency and openness

11

Thanks

12