IN a major policy decision, the Sindh cabinet has approved a draft law for the creation of the first provincial electric power regulatory authority — or the provincial equivalent of Nepra. The establishment of the proposed ‘Sindh Electric Power Regulatory Authority’ is billed to change the dynamics of power-sector governance in the country and eliminate Nepra’s role in the development of generation projects and tariff determination in the province. It will also allow the Sindh government to encourage the use of the cheaper local resource of Thar coal for power generation and to exploit its renewable and cleaner energy potential of wind and solar for producing affordable electricity. Sepra’s creation, provincial ministers say, will “improve energy equity and eliminate energy poverty” in Sindh, besides ending its dependence on the centre for determining tariffs for future generation projects in the province.

Sindh’s decision to have its own electric power regulatory body is driven by Nepra’s incompetence. But the immediate stimulus has apparently come from Nepra’s decision to exclude cost-effective generation projects, including wind and solar power, from the NTDC’s Indicative Generation Capacity Expansion Plan, 2022, in order to make room for expensive hydropower schemes in KP and elsewhere in the country. The provincial authorities had raised concern over the controversial Nepra decision at that time but the national regulator perhaps did not have the will or competence to fulfil its responsibility of rejecting expensive projects. No wonder Sindh’s energy minister told journalists after the cabinet’s approval of the proposed Sepra bill that the province was facing certain constraints in encouraging cheaper electricity and ending power shortages in the province within the national framework. Hence the province’s decision to take regulatory control of future power production, tariff determination, transmission and distribution projects into its own hands. Ideally, regulatory functions should be centralised at the national level. But when national bodies fail to function in the interest of all stakeholders, they lose their legitimacy.

Published in Dawn, April 15th, 2023