CPPA projects PKR 3.55 trillion power purchase cost for 2027

Pakistan’s Central Power Purchasing Agency-Guarantee (CPPAG) has projected a total power purchase cost of PKR 3.552 trillion for calendar year 2027 under its base-case scenario, equivalent to an average PKR 27.309 per kilowatt-hour.

CPPA-G submitted the forecast to the National Electric Power Regulatory Authority for use in rebasing the consumer-end tariffs of ex-WAPDA distribution companies from January 1, 2027.

The filing sets out six scenarios based on different assumptions for electricity demand, fuel prices, exchange rates and other economic variables. The projections remain subject to NEPRA’s review and determination.

How much could the 2027 power purchase price rise?

Under CPPA-G’s six scenarios, the average price ranges from PKR 25.883 per unit in the ideal case to PKR 29.255 in the highest-cost case. Compared with NEPRA’s approved 2026 reference of PKR 25.32, that represents increases ranging from about 2.2% to 15.5%, with the base case up 7.9%.

The ideal scenario projects a total cost of PKR 3.367 trillion, while the two worst-case scenarios put the cost at PKR 3.751 trillion and PKR 3.806 trillion, respectively.

A demand-sensitivity scenario projects PKR 3.527 trillion, or PKR 27.568 per unit, while a scenario using a mix of regasified liquefied natural gas and indigenous gas puts the cost at PKR 3.439 trillion, or PKR 26.441 per unit.

Under the base case, CPPA-G assumes electricity demand growth of 2.6%, an exchange rate of PKR 279 per US dollar and sales of 130,081 gigawatt-hours.

The two worst-case scenarios assume the rupee at PKR 290 per dollar and higher fuel prices. The demand-sensitivity case assumes growth of just 0.7%, reducing projected sales to 127,937 GWh.

Capacity charges remain the largest component

Capacity charges are projected at between about PKR 1.914 trillion and PKR 1.962 trillion across the scenarios.

Under the base case, capacity charges amount to PKR 1.914 trillion, or PKR 14.717 per unit. Fuel costs are projected at PKR 1.319 trillion, variable operation and maintenance costs at PKR 70.575 billion, and transmission and Ministry of Finance-related charges at PKR 248.3 billion.

NEPRA has scheduled a public hearing on the filing for November 3 at 2 p.m., after which the regulator will consider the assumptions and stakeholder submissions in determining the 2027 PPP references.

How does 2027 compare with the current year?

For calendar year 2026, NEPRA approved a projected power purchase cost of PKR 3.186 trillion, equivalent to an average PKR 25.32 per unit.

Capacity charges for 2026 were approved at PKR 1.923 trillion, or PKR 14.86 per unit.

That means CPPA-G’s 2027 base-case total cost is about 11.5% higher than the approved 2026 projection, while the average per-unit price is about 7.9% higher.

CPPA-G stressed in its filing that the 2027 figures are indicative and could change with movements in fuel prices, electricity demand, exchange rates, inflation, generation capacity and other assumptions.