NTDC shows reservations to grant of licence for KP Transmission Company.

ISLAMABAD -- The National Transmission and Despatch Company (NTDC), Central Power Purchasing Agency (CPPA) while showing its reservations to the grant of license for Khyber Pakhtunkhwa Transmission and Grid System Company (Pvt) Limited, saying NEPRA Act allows only One System Operator in the country at one time.

In response to the application of the Khyber Pakhtunkhwa government for the grant of license for provincial Transmission and Grid System Company (Pvt) Limited with NEPRA, NTDC and CPPA expressed reservations. NEPRA will hold public hearing on the application on February 10, 2021.

NTDC in its comment said that the grant of license to a Provincial Grid Company (PGC) of KP under Section 18A of the NEPRA Act would inevitably lead to interconnection at provincial and federal levels and should be centrally and carefully planned. Either one or both operators, thus requiring the responsibility of partial or full grid system collapse to each other, NTDC further added.

In its comment the NTDC said that under Article 154(1) of the Constitution, the Council of Common Interests (CCI) shall formulate and regulate policies in relation to matters in Part II of the Federal Legislative List of the Constitution. In light thereof, if a matter falls within the powers of CCI under Article 154, it must be placed before it. The subject of 'Electricity' is listed as Entry No. 4 in Part II of the Federal Legislative List of the Constitution and therefore, the policy decisions in respect of the electricity must be placed before the CCI.

In light thereof the preparation and prescription of policy framework in respect of inter alia, the integration of national and provincial transmission systems under Section 14A of the NEPRA Act is a sine qua non for the operations of, and/or grant of license to any provincial grid company. Unless such policy framework becomes effective, no license could have been granted to any provincial grid company under Section 18A of the NEPRA Act.

From a perusal of Section 18A(2) of the NEPRA Act, it is evident that the same provides that the eligibility criteria for grant of license as a provincial grid company shall be prescribed, including the minimum solvency and minimum technical and human resource requirements. Further, the term 'prescribed' has been defined by Section 2(xxii) of the NEPRA Act and requires such criteria to be prescribed by rules, to be made by the federal government. The term 'shall be prescribed' indicates that...