• Nepra Public Hearing presided by President Waseem Mukhtar.
• The goal of strategic adaptation is to reduce customs volatility.
• Additional reforms include reduction of indexing for O&M costs.

Islamabad: National Electric Power Regulatory Authority (NEPRA) has decided to stop using dollar -based indexes for Haveli Bahadur Shah, Balloki, Northern Power Generation Company Limited (NPGCL) and Central Power Generation Co. LTD (CPGCL) Power Plants, to switch to rupee-based indexes that are fixed for the duration of useful life.

This trait will pave the way for saving RS1.6 trillion in projects’ remaining life, The news reported.

Nepra called for a public consultation, chairman of President Waseem Mukhtar, at his Islamabad offices on Thursday. Tariffodifications for Haveli Bahadur Shah, Balloki, NPGCL and CPGCL power plants were discussed during the consultation.

The goal of this strategic adaptation is to reduce customs volatility and currency exposure for users. Additional reforms include reduction of indexing for operation and maintenance (O&M) costs from 100% to 70% of rupee evaluation.

Local O&M expenses will now be indexed to either 5% or 12-month average of the National Consumer Price Index (NCPI), whichever is lower.

In addition, the return on equity (ROE) structure is rationalized. Plants will now receive 35% of ROE as fixed, with the remaining 65% associated directly to the actual operation of the plant – a significant deviation from the previous 100% guaranteed ROE model.

These all-exciting measures will result in an expected saving of RS1.6 trillion over the lifetime of the projects, including RS22 billion in the current financial year alone, the press release said.