NEPRA Approves Tri-Partite Power Purchase Agreement for KAPCO

Kot Addu Power Company Limited (PSX: KAPCO) has announced that the National Electric Power Regulatory Authority (NEPRA) has approved the Tri-Partite Power Purchase Agreement (TPPA) involving KAPCO, the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G), and the National Grid Company of Pakistan Limited. According to a stock filing, NEPRA issued a letter dated May 19, 2025, granting formal approval of the TPPA along with its schedules. However, the agreement’s operational effectiveness is subject to specific conditions outlined by the regulator. Before the TPPA can take effect, KAPCO must conduct an Initial Capacity Test (ICT) and a Heat Rate Test (HRT) to benchmark the plant’s efficiency. An Independent Engineer is required to evaluate and determine the plant’s Simple Cycle Efficiency and Heat Rate metrics. These findings, along with the test reports, must be submitted to NEPRA. Only after NEPRA reviews and accepts these performance benchmarks will the TPPA come into operational force for the Kot Addu power plant.