Nepra, ISMO clash over power plan 2025–35 on projects, demand, timelines

Differences have emerged between the National Electric Power Regulatory Authority (Nepra) and the Independent System and Market Operator (ISMO) over key components of the Integrated System Plan (ISP) 2025–35, including project inclusion, demand projections and regulatory compliance, Business Recorder reported. 

In its response to Nepra’s observations issued on March 11, 2026, ISMO defended the exclusion of certain hydropower projects from the Indicative Generation Capacity Expansion Plan (IGCEP) 2025. It cited revised demand outlook, project delays and updated planning considerations as reasons for revisiting the list of “committed” projects.

ISMO maintained that the ISP 2025–35 has been prepared in line with the National Electricity Policy 2021 and the National Electricity Plan 2023–2027, which require periodic updates to reflect evolving sector conditions.

However, Nepra opposed the exclusion of projects such as the 88MW Gabral Kalam and 157MW Madyan hydropower plants, stating that these had been classified as committed projects under IGCEP-2021 based on assumptions approved by the Council of Common Interests. The regulator said such projects should remain part of subsequent plans unless justified within the approved framework.

ISMO argued that while earlier assumptions were approved, subsequent plans must incorporate updated data on demand, project progress and costs. It said retaining outdated commitments could undermine least-cost planning.

The system operator said a technical working group formed in November 2023, led by the Central Power Purchasing Agency Guarantee Limited, revised the criteria for classifying projects as committed. Under the updated framework, projects must demonstrate at least 10 per cent progress and meet development milestones.

ISMO stated that the Gabral Kalam and Madyan projects did not meet these thresholds, with progress below 3% and construction yet to begin, while timelines for completion had been pushed back.

On renewable energy, Nepra raised concerns over the limited inclusion of K-Electric projects, including solar and hybrid initiatives approved through competitive bidding. It said these projects should be reflected in the plan.

ISMO responded that approval of Requests for Proposals or inclusion in power acquisition programmes does not automatically qualify projects as committed. It added that including such projects without meeting criteria could increase system costs, estimating an additional impact of $0.19 billion.

Differences were also noted over demand projections. Nepra highlighted inconsistencies between estimates used in the ISP and those reflected in distribution companies’ investment plans and forecasts of the Central Power Purchasing Agency.

ISMO said it has finalised demand projections in line with its mandate under the Grid Code and attributed the downward revision in demand to slower economic growth and increased adoption of rooftop solar systems.

On the transmission side, Nepra expressed concern over the submission of an addendum instead of a full Transmission System Expansion Plan, noting that several projects require reassessment.

ISMO maintained that while overall demand has declined, peak demand at the distribution level remains stable, supporting continuation of network expansion with revised timelines.

The regulator also flagged discrepancies in commercial operation dates used in the plan, citing differences between timelines provided by executing agencies such as the Water and Power Development Authority and the Pakistan Atomic Energy Commission and those reflected in the ISP.