KAPCO requests NEPRA to grant provisional tariff approval

October 24, 2022 (MLN): Kot Addu Power Company Limited (PSX: KAPCO) on Monday requested NEPRA to approve a provisional tariff for the interim period for, inter alia meeting technical, operational, and dispatch requirements of the power purchaser and the system, the company’s filing on PSX showed today.

To recall, the company's Power Purchase Agreement (PPA) dated June 27, 1996 (as amended) (Original PPA) completes its term on an even date (October 24, 2022); and consequently, and consequently, the company will not sell electric power to the power purchaser under the terms of the Original PPA.

The company's generation license was renewed by the NEPRA on September 8, 2022, for a term of three years that will expire on September 24, 2024).

In this context, the company has submitted an application for Reference Generation Tariff (Tariff Petition), under the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997, and the rules and regulations made thereunder including the NEPRA (Tariff Standards and Procedure) Rules, 1998 before NEPRA on even-date (October 24, 2022).

The power purchaser and the company have agreed to enter into a new power purchase agreement for the sale and purchase of electric power. The term of the new power purchase agreement is being proposed by the company to be five years, subject to applicable legal and regulatory formalities, including approval of the generation tariff by NEPRA pursuant to the Tariff Petition.

As NEPRA has yet to arrive at a determination in respect of the Tariff Petition and the Original PPA will expire on even date, the company requested a grant of Provisional Tariff Approval.

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