Central Power Purchasing Agency (Guarantee) Limited (CPPA-G) is a company incorporated under the Companies Ordinance 1984 (XLVII of 1984) and granted a Corporate Universal Identification No. 0068608 by the Security Exchange Commission of Pakistan. The company was incorporated in the year 2009 after its segregation from National Transmission and Dispatch Company (NTDC), however, it continued its operations under NTDC (as the department of NTDC) till June 2015, when a separate entity was made operational.
COMPANY’S REGISTRATION
As per Rule 5 of the Market Rules, CPPA-G shall be deemed to be authorized and registered as the market operator. Thus, for a period of two years from the commencement of the Rules CPPA-G has, by operation of Rule 5, been deemed to be the market operator and authorized and registered to conduct the market operations for this period.
Therefore, in view of above and in compliance to Rule 3, Sub-Rule (2) of the Rules, CPPA is in the process of filling Registration Application before NEPRA to register as market operator.
BACKGROUND
Pakistan initiated power sector reform In the 1990s with the restructuring of WAPDA, the enactment of NEPRA Act and the operationalization of the electricity regulator (NEPRA). By 2002-2005, WAPDA successor companies had been created and licensed, thus separating transmission, generation, and distribution and retail supply into different companies. WAPDA became a power company dedicate to hydropower, and no longer responsible or with the right to procure power.
A regulatory framework was developed, and NTDC licensed in 2002 with two functions in addition to transmission and system operation functions. These functions, assigned in the license as transitory arrangements to reflect the change in sector structure and future power market, were: (i) development and implementation of competitive electricity markets, including a contract registrar; and (ii) as WAPDA could no longer be the Buyer in PPAs with new generation, procure power on behalf of the distribution companies created in the restructuring of WAPDA (DISCOs) until the wholesale competition market started commercial operation (expected by 2009, and no later than 2012) when DISCOs would contract and procure power on their own. In this way the CPPA function in NTDC License introduced a change in the power purchase and market model, where each and all DISCOs buy power through a representative that is responsible to negotiate, sign, and administer the billing and settlement of PPAs.
Consistent with the expected market development, in 2009 CPPA G was created as a power company to take over the CPPA and market development functions from NTDC as expected in 2002 NTDC License. The commercial operation of CPPA-G started in mid of 2015 when the transfer of functions were formalized and completed between NTDC and CPPA-G. The function and scope of authority of CPPA G are regulated by NEPRA Market Operator Rules.
