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2. National Institute of Management,
Quetta
32nd Mid-Career Management Course
“National Electric Power Policy 2021:
An Analysis”
• Presented By: “Name & Service Group of Participant”
• Sponsor DS: “Name of Respective Faculty”
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3. 3
Abbreviations

4. Sequence of Presentation
 Introduction
 Objectives
 Scope
 Currency of The Topic
 Issues & Challenges
 Analysis
 Conclusions
 Recommendations
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5. Objectives
 To explore salient features of National Electric power
policy 2021.
 To analyze positive aspects of new power policy.
 To explore weak areas of the policy.
 To propose workable recommendations.
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6. Scope
 The presentation covers following three major
aspects of Energy Policy, 2021;
a) Salient features of Energy policy, 2021
b) What’s new in current policy?
c) Will it be effective or not?
d) Conclusions/Recommendations
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7. Currency of the Topic
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National Electric Power
policy 2021 stresses on
passing full cost of power
generation through tariff
revisions to consumers.
“The Express Tribune”
16-10-2021

8. Introduction
 National Electric Power policy 2021 features three
major highlights:
a) Access to affordable electricity supplies
b) Energy security
c) Energy sustainability
 The policy specifies following guiding principles:
Efficiency, transparency, competition, financial
viability, indigenization, and environmental
responsibility.
8
https://dailytimes.com.pk/558147/national-electricity-policy-2020-high-in-intent-but-low-in-
content/. Accessed on 15-10-2021

9.  National Finance Commission (NFC) Award to be used
for recovery of outstanding amount owed by the provinces
or their departments to the power sector.
 Full cost of electricity generation is to be passed on to the
consumers.
 Consumer end tariff will include additional surcharges to
cater for additional costs/losses at distribution end.
 NEPRA to be mandated to impose additional charges to
ensure liquidity of the electricity sector and facilitate
future projects.
 National Electricity Policy 2021 prevails over the Power
Generation Policy 2015.
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Introduction
https://tribune.com.pk/epaper/2021-10-16/1. Accessed on 15-10-2021

10.  The policy stresses on energy mix revisions and
dependence on renewable energy technologies.
 However, renewable energy technology is considered
costly and generation through such sources cannot
bring “Cost of tariff low”.
 Renewable energy is inherently intermittent in nature,
which presents technical challenges to weaker grids like
Pakistan.
 The policy Plans to build more coal-fired power plants
as part of the second phase of the CPEC. The policy
option could raise environmental concerns.
 The Policy does not clearly define the mechanism
through which tariff rate would be set for various
modes of generation.
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Issues & Challenges

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 It is not clear that what exactly the measures will
be taken to set prices of electricity coming through
various sources.
 Will the price be the same for all categories of
consumers?
 Will it vary in accordance with type of consumer?
 Will it be helpful in Minimizing risk to imported
fuel supplies?
Issues & Challenges Cont’d

12. Analysis on Policy Positives
 The policy projects expanded scope to:
i. Reduce the reliance on imported fuel for power
generation
ii. Optimum utilization of local resources such as coal,
water, renewable sources, local gas and nuclear.
iii. Integrated planning for decisions on energy mix to
achieve more affordable and secure generation mix.
iv. Construction of multipurpose water reservoirs and
tapping of hydro power potential for power
generation.
v. Enhanced focus on alternate and re-newable energy
resources for power generation.
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13.  The policy mandates autonomy of the regulator
(NEPRA) ,its careful review and scrutiny of all costs
to be imposed on final consumers is of utmost
importance to the health, viability, and sustainability
of the power sector, and, therefore, must be
maintained. (Expected outcome will be reduced
burden of circular debt and huge pending payments
on power sector)
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Analysis on Policy Positives

14. Analysis on Policy’s Weak Areas
 The Policy specifies the role of a “Nominated
Entity” in the monitoring, evaluation, and mid-
course correction of the Policy during its
implementation. The aspect is ambiguous and its
unclear on whether this “Nominated Entity” is
adequately equipped for effectively discharging its
contemplated role in the Policy or would require
improvement.
 The targets set for renewables (20% by 2025 and 30%
by 2030) have no mention in the Policy.
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15.  The policy does not guide the power sector entities
and their managements downstream as to what they
are being asked to focus on, accomplish, and by
when?
 The Policy also does not specify the metrics that will
be used to assess their success or failure on each
count.
 The policy does not focus on institutional capacity in
electric power sector.
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Analysis on Policy’s Weak Areas

16. 3/23/2023 16
Analysis on Current & Past Policies
Feature Electricity Policy, 2021 Past Policies
Energy Mix
stresses major reliance on local
energy sources
Heavily relied on imported
fuels
Future Energy
Requirements and
Energy Mix
3-Year review on Additional
energy requirements and
energy mix
No focus on Energy Mix
and additional
requirements
Tariff Calculation
Currency devaluation factor to
be taken into account
Unlimited dollar
indexation
Transfer of
Technologies
Incentives for technology
transfer for local Industry
No incentives for
encouraging ToT
Tariff Revisions
NEPRA mandated additional
powers to pass on full cost to
consumers.
Tariff Revisions were
based on net cost of
generation only.

17. Conclusions
 The policy projects encouraging goals of
“affordability”, “security” and “sustainability” of
electricity.
 The policy is tall in intent but vague in application.
 The policy lacks the specificity, concreteness, and
associated timeframes. Non-specific, and abstract in
content.
 It lacks the substance that was essential to pull the
ailing power sector out of the present challenges and
set it on a course to financial health and vitality in the
future.
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18.  It will be difficult to translate into practical, concrete,
and doable strategies and work-packages as the
Policy does not provide any guidance as to how these
are to be operationalized and put in to practice.
 The policy sets no time-based landmarks with clear
mechanism on how to achieve those milestones.
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Conclusions

19. Recommendations
 Government needs to focus on requisite leadership,
managerial capacity, technical expertise, and
supportive tools on ground to make this policy a
success.
 End user tariff revisions based on losses at generation
and distribution might result into a stall into
infrastructure development for national grid.
 Recovery of outstanding amount from provinces in
respect of power tariffs through NFC award might
bring political divisions.
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https://www.thenews.com.pk/print/611708-national-electricity-policy-2020-govt-to-recover-
power-dues-owed-by-provinces-from-nfc-award. Accessed on 15-10-2021

20.  In the future, every new scheme for serving the
consumer demand of electricity in the country should
be evaluated in terms of the actual cost (whether it is
to be incurred or avoided; monetary as well as social
and environmental) it will impose on the country.
This will ensure a level-playing field for all supply
options, conventional as well as new renewables.
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Recommendations