Competitive electricity market
The government has recently announced its decision of moving towards competitive market in the power sector. For this purpose, a new power policy is being formulated and amendments have been made in the regulatory laws. While the transition to the Competitive Electricity Markets (CEM) is appreciable provided it brings dividends to consumers in the shape of greater choice in selection of electricity suppliers, a reduction in tariff and reliability of power supplies. With circular debt of Rs 923 billion on the books of the government entities, subsistence of long-term concession contracts up to year 2045 and loss-making, inefficient and mismanaged government-controlled distribution companies, the CEM is likely to create further chaos, uncertainty and volatility in the prices of electricity. While we are common law jurisdiction, the regulatory law is patterned on US regulatory laws and CEM is being injected with ‘Turkish Dose’. A perfect epitome of our ‘haywire’ approach.
Published in Business Recorder, 25th March, 2018