CLIENT
ADB / National Electric Power Regulatory Authority, Pakistan
TITLE
Tariff Policy Specialist
COUNTRIES
Pakistan
DATES
2001
SECTOR
Electricity
PROJECT DESCRIPTION
In 1992, the Government approved WAPDA’s Strategic Plan for the Privatization of the Pakistan Power Sector. This Plan sought to meet three critical goals:
1. Enhance capital formation
2. Improve efficiency and rationalize prices
3. Move over time towards full competition by providing the greatest possible role for the private sector through privatization
A critical element of the Strategic Plan was the creation and establishment of a Regulatory Authority – NEPRA – to oversee the restructuring process and to regulate monopolistic services. This assignment was targeted at improving the capacity of NEPRA in a number of different regulatory policy areas including: licensing, technical codes, tariff setting and customer service.
SERVICES PROVIDED BY STRATEGY & ECONOMICS
S&E provided the Tariff Policy expert in this ADB funded project targeted at strengthening the regulatory capacity of NEPRA, the National Electric Power Regulatory Authority, to provide a sound basis for private sector investment in the sector, and the privatisation of Karachi Electricity Supply Company in particular.
The work focused principally on amending the existing cost of service approach to tariff setting through the introduction of a performance based system of price regulation aimed at incentivising the utilities to introduce efficiency improvements including controlling their labour costs.