Provincial Energy Minister Nasir Shah in interview assures to reduce operational costs, minimize losses, improve recoveries, and reduce electricity theft in Sindh and its capital Karachi; says STDC will work closely with SEPRA for effective transmission of clean energy
Energy Update magazine conducted an Interview with Sindh Energy Minister Syed Nasir Hussain Shah. Some excerpts of the interview are: Nasir Shah said that by enacting the Sindh Regulation of Electric Power Services Act 2023, we aimed to establish regulatory control within our territory, enabling Sindh to fully capitalize on its energy resources, support industrial growth, and ensure sustainable development for our people.
This step reaffirms our commitment to taking control of our energy destiny and ensuring that the people of Sindh benefit from our vast energy resources, he added.
Shah said that they were committed to improving the electricity supply, making it more reliable and affordable. SEPRA is central to our strategy, and through innovative market-based solutions, we anticipate significant improvements that will benefit all consumers throughout the Province.
Question No.1: Why did the Sindh government deem it necessary to establish Pakistan’s first-ever provincial power sector regulator in line with the 18th Constitutional Amendment?
Answer: We established Pakistan’s first-ever provincial power sector regulator in line with the 18th Constitutional Amendment to assert Sindh’s constitutional rights under Article 157(2), which remained intact even after the Amendment. This article empowers us to construct powerhouses, lay transmission lines, and manage the distribution and supply of electricity within the provincial territory.
Additionally, Section 7(4) of the NEPRA Act 1997 also supports provincial autonomy in managing electricity-related matters. The National Electricity Policy (NEP) 2021, which is duly approved by the Council of Common Interest (CCI), also recognizes provincial rights over the provision of electric services by a provincial government within its territory.
Our decision was also driven by several challenges, including the exclusion of key renewable energy projects from the federal government’s Indicative Generation Capacity Expansion Plan (IGCEP) during its first iteration in 2020-21 and NEPRA’s refusal to grant tariffs to renewable energy developers in Sindh who were duly issued LoIs by the provincial government.
These federal government decisions severely impacted our efforts to harness Sindh’s renewable energy potential, particularly in the Jhimpir-Gharo Wind Corridor, and threatened our economic growth, especially in the textile sector under global pressures like the Paris Agreement and Carbon Border Adjustment Mechanism.
By enacting the Sindh Regulation of Electric Power Services Act 2023, we aimed to establish regulatory control within our territory, enabling Sindh to fully capitalize on its energy resources, support industrial growth, and ensure sustainable development for our people.
I’m pleased to inform you that recently, the Provincial Cabinet has approved the establishment of SEPRA by appointing its Chairman and Members. Additionally, we have allocated a budget of Rs200 million for its establishment. This step reaffirms our commitment to taking control of our energy destiny and ensuring that the people of Sindh benefit from our vast energy resources.
Question No.2: To what extent the setting up of SEPRA will serve the cause of ensuring uninterrupted power supply to residential, commercial, and industrial consumers in Sindh at the most affordable rates?
Answer: The establishment of SEPRA is a vital step in our ongoing efforts to ensure that all consumers in Sindh—residential, commercial, and industrial—receive a reliable power supply at the most affordable rates. While the Federal Government currently manages energy procurement, transmission, and distribution across most of the country, except in Karachi where K-Electric (KE) operates, we see SEPRA as a key player in complementing these efforts.
Our goal with SEPRA is to work closely with both federally owned distribution companies ie HESCO, SEPCO, and KE to develop effective mechanisms that enhance the consistency of power supply. We are particularly focused on reducing operational costs, minimizing losses, improving recoveries, and reducing electricity theft as these factors are crucial for keeping electricity affordable. Additionally, we plan to engage with the federal government to explore ways to reduce taxation on electricity, which would help lower the overall cost for consumers. We will also advocate for electricity to be priced closer to the actual cost of service, which would further alleviate the financial burden on consumers.
In Karachi, SEPRA will have a significant role to play. By promoting innovative models such as Business-to-Business (B2B), Business-to-Consumer (B2C), and Public-Private Partnerships (PPP), we aim to provide more affordable electricity options for both businesses and households. These models are designed to encourage competition and private sector participation, leading to more efficient and cost-effective electricity distribution.
Moreover, we are committed to promoting the use of renewable energy sources for households across Sindh. By encouraging the adoption of solar and other renewable energy solutions, especially in off-grid and remote areas, we hope to offer a sustainable and cost-effective alternative to conventional power. This not only reduces our dependency on the national grid but also helps lower electricity costs for consumers while contributing to environmental sustainability.
Ultimately, SEPRA is about collaboration. We are committed to working with all stakeholders, including the Federal Government, to ensure that Sindh’s electricity needs are met in a manner that is both reliable and affordable. Our aim is to create a more efficient, sustainable, and consumer-friendly electricity sector that truly benefits everyone in the province.
Question No. 3: Will the setting up of SEPRA be helpful for the cause of tapping the massive clean energy generation potential of Sindh in the form of solar and wind power?
Answer: The establishment of SEPRA is indeed a significant step towards harnessing Sindh’s massive clean energy potential, particularly in the form of solar and wind power. Renewable energy development is a key priority for us, and this is reflected in the draft Sindh Electricity Policy 2024, which the Energy Department has currently circulated for comments and feedback from stakeholders. Once we receive and incorporate any comments, the revised draft will be presented before the Provincial Cabinet for approval and implementation.
We have vast wind corridors, particularly in the Jhimpir-Gharo regions, and significant solar energy potential that remains largely untapped. Through SEPRA, I aim to streamline the regulatory processes, making it easier for investors and developers to initiate and complete solar and wind projects. SEPRA will provide a structured framework that ensures these projects are developed efficiently and are integrated into the broader energy network of the Province.
A critical component of this effort is the role of the Sindh Transmission and Dispatch Company (STDC), which is mandated to provide transmission services through wheeling. The STDC will work closely with SEPRA to ensure that the electricity generated from renewable sources is effectively transmitted to where it is needed most. This collaboration will facilitate the efficient transfer of power from solar and wind projects to the grid, thereby maximizing the use of renewable energy and ensuring that it reaches consumers across Sindh.
Moreover, SEPRA’s role in promoting competitive market mechanisms will attract private sector investment in renewable energy. By enabling Business-to-Business (B2B) and Business-to-Consumer (B2C) models, as well as Public-Private Partnerships (PPP), I believe we will encourage a more dynamic and responsive energy sector that can meet the growing demand for clean energy.
Question No. 4: Will the establishment of SEPRA be beneficial to promote B2B arrangements for greater involvement of the private sector to energize industries and commercial buildings in urban centers in Sindh?
Answer: Yes, as I mentioned earlier, the establishment of SEPRA will indeed be highly beneficial in promoting Business-to-Business (B2B) arrangements, along with Business-to-Consumer (B2C) and Public-Private Partnership (PPP) models. These mechanisms will facilitate greater involvement of the private sector in energizing industries and commercial buildings in urban centers across Sindh.
The draft Sindh Electricity Policy 2024 places a strong emphasis on creating a competitive and dynamic energy market that encourages private sector participation. With SEPRA in place, we will have the necessary regulatory framework to streamline and facilitate these B2B transactions, allowing industries and commercial entities to directly engage with power producers. This will not only provide them with more reliable and tailored energy solutions but also help in reducing costs by fostering competition among power providers.
Furthermore, SEPRA’s oversight will ensure that these arrangements are conducted transparently and fairly, with clear guidelines and standards that protect the interests of all parties involved. By empowering the private sector through these mechanisms, I am confident that SEPRA will significantly contribute to the economic growth and industrial development of Sindh’s urban centers, making them more competitive and sustainable.
We are fully committed to implementing these models effectively, ensuring that they bring the intended benefits to our industries and communities.
Question No. 5: To what extent will the power consumers in Karachi, who have been enduring prolonged power load shedding despite paying inflated power bills every month, benefit from the establishment of SEPRA?
Answer: The establishment of SEPRA offers a significant opportunity for power consumers in Karachi, who have unfortunately been enduring prolonged power load shedding despite paying inflated bills. I understand the frustrations that come with this situation, and I want to assure you that we are fully committed to addressing these issues.
While K-Electric currently operates under the regulatory domain of the federal regulator NEPRA and procures a substantial amount of electricity from the national grid, I believe that SEPRA can complement these efforts and play a crucial role in enhancing the overall electricity landscape in Karachi. Our aim with SEPRA is to create a more competitive and efficient electricity market that benefits all consumers, not just in Karachi, but across the entire. We are fully committed to improving the electricity supply, making it more reliable and affordable. SEPRA is central to our strategy, and through innovative market-based solutions, we anticipate significant improvements that will benefit all consumers throughout the province.
To achieve this, we are exploring the potential introduction of multiple distribution companies within KE’s service territory under the SEPRA Act 2023. This could enhance service quality and reliability by fostering competition, though it presents certain complexities that we would need to manage carefully. I understand that bringing KE under SEPRA’s regulatory domain would be a significant move, and I am fully aware of the delicate and thoughtful approach required to make this happen.
At the same time, I am confident that SEPRA will provide immediate relief to industrial, bulk consumers, and large housing societies through B2B and B2C arrangements under the market mechanism. These arrangements will allow these consumer segments to engage directly with power producers, potentially bypassing some of the issues associated with the existing distribution framework. This initiative is an invitation for the private sector to step forward and contribute to more reliable and cost-effective power solutions.
I want to assure everyone in Sindh, including Karachi, that we are fully committed to improving the electricity supply and making it more reliable and affordable. SEPRA is central to our strategy, and through innovative market-based solutions, we anticipate significant improvements that will benefit all consumers throughout the province.
