Nepra cuts CPPA-G market fee to Rs10.5248 per kW per month

The National Electric Power Regulatory Authority (Nepra) has approved a revised market operation fee of Rs10.5248 per kW per month for the Central Power Purchasing Agency-Guarantee (CPPA-G) for FY2025-26, against the agency’s requested fee of Rs14.67 per kW per month.

BR reported, citing Nepra’s determination issued on June 29, 2026, that the regulator reviewed CPPA-G’s petition and cost projections, including salaries, employee benefits, administrative expenses, training, consultancy services, hiring plans, taxes, capital expenditure and prior year adjustments.

CPPA-G had projected a total net revenue requirement of up to Rs. 4.664 billion. Its requested fee stood at Rs14.67 per kW per month, compared to a base calculation of Rs9.08 without adjustments.

Nepra held a public hearing on December 23, 2025. The authority said it did not receive any objections or comments from stakeholders. However, intervenors have protested that their comments were ignored in the decision.

A major part of CPPA-G’s request related to salaries, benefits and new hiring. The agency argued that about 75 per cent of its workforce consists of skilled professionals responsible for managing power purchase invoices worth more than Rs4 trillion.

Nepra allowed a 10.49 per cent increase in salaries and wages for FY2025-26, slightly below CPPA-G’s requested 11 per cent increase. The regulator approved Rs1.585 billion under this head, excluding the impact of employees who had resigned or been transferred.

Employee benefits linked to salaries were approved at Rs249 million.

Nepra also reduced the requested bonus payment, allowing one basic salary amounting to Rs55.64 million instead of CPPA-G’s proposed 1.5 gross salaries.

On recruitment, CPPA-G had sought allocations for replacing resigned staff and expanding technical and IT departments, citing requirements related to digital transformation, data analytics, cybersecurity and system modernisation.

Nepra approved Rs109.71 million for new hiring based on 26 positions already filled. It said any further recruitment would be considered in future tariff petitions.

For training and capacity building, CPPA-G requested Rs32 million. Nepra allowed Rs8.58 million, citing actual expenditure and reduced requirements after segregation of the market operator function.

The regulator said CPPA-G’s costs ultimately affect end-consumer tariffs, making cost scrutiny necessary.

The decision has been sent to the federal government for notification in the official Gazette within 30 days. If the government does not notify it within that period, Nepra will issue the notification itself.

Nepra also directed CPPA-G to immediately file its next tariff petition under the Multi-Year Tariff regime.

The regulator asked CPPA-G to submit an updated Power Purchase Price forecast report every year, accounting for upcoming generation additions, demand changes, exchange rate parity, local and US CPI, LIBOR, KIBOR and IGCEP.

CPPA-G has also been directed to share quarterly HR development progress, including department-wise employee details, functions performed by each department and any future recruitment plans with proposed IDs.

Nepra directed the agency to inform the authority about future hiring plans before making appointments and to provide the composition of its Board of Directors, including brief profiles, basis of appointment and roles and responsibilities.

The regulator further directed CPPA-G to provide monthly information on energy generated, capacity and other charges, payments and fuel stocks held at each power plant in prescribed formats.

CPPA-G has been asked to submit complete details of any deviation from the Economic Merit Order, including hourly generation, financial impact and reasons, in coordination with NPCC and within the timelines already directed in monthly FCA decisions.

Nepra also directed the agency to submit monthly reconciliation reports of T&T losses with NGC, provide details and status of all legal cases, including international arbitrations and cases filed against Nepra as part of quarterly adjustments, and submit monthly reports on liquidated damages imposed on generation companies along with reasons.

CPPA-G has also been directed to seek prior approval from Nepra before making any expenditure beyond the allowed cost for FY2025-26 under any head of account.