CCI approves National Electricity Policy 2021 to reform power sector

The government has allocated Rs1 billion for the transmission network

Federal Minister for Energy Hammad Azhar said that the Council of Common Interests (CCI) had unanimously approved the National Electricity Policy 2021 to streamline matters related to the power sector.

“It is a historic time [for Pakistan] as we have succeeded to formulate a national electricity policy which will have its impact in the next five to ten years when our next generations will get inexpensive and eco-friendly electricity, mainly depending on local fuels,” the minister told a news conference.

In a press briefing alongside special adviser to the Prime Minister on Finance and Revenue Dr Waqar Masood Khan, the energy minsiter said the policy was formulated after extensive deliberation with all the stakeholders who had discussed each and everything related to the power sector at length.

“Transparency, development of local fuels and more reliance on clean energy was the hallmark of the national electricity policy,” he said, adding that a national action plan would be chalked out under the initiative.

The new policy was formed with a long-term view that would focus on reforming the power sector in the coming decade, the minister said. The policy envisioned special targets for renewable energy, long-term hydel projects and development of local fuels, paving the way to determine the power tariff through an open competitive process among private investors.

Hammad said the major issue in the power sector was the finances, not electricity generation as the incumbent government faced issues related to capacity payments of billions of rupees annually due to expensive agreements signed by the previous regimes with independent power producers (IPPs).

Another major issue was the electricity transmission as the capacity to transmit the power had been increased up to 24,000 megawatts during the last two years.

The government has allocated Rs1 billion in the budget for the new fiscal year for the transmission network that still required capacity addition of around 10,000 MW

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