NEPRA Unearths Serious Flaws in Sahiwal Power Plant’s Coal Purchasing Process

The National Electric Power Regulatory Authority (NEPRA) through a probing committee has identified major irregularities in coal procurement by Sahiwal Coal Power Plant. These irregularities were mainly concerning competition, pricing, and procedure. The investigation was initiated last year. Some bidders alleged collusion, steep pricing, and restrictive bidding. However, the NEPRA probe did not charge any party for procurement decisions or accuse the plant’s management of any wrongdoing. The committee’s report noted that only one qualified bidder participated in the procurement process, limiting competition. The committee said the bidders failed to provide concrete evidence despite multiple reminders. However, it agreed that NEPRA lacks formal guidelines for long-term coal procurement and urged the regulator to address this issue. Bidders claimed a supplier had prior knowledge of a winning bid which provided the company a window to deliver coal immediately after contract execution. Another key issue was the alleged price difference, with coal supplied at Rs. 75,000 per ton while market rates stood at Rs. 40,000. However, the committee couldn’t find enough data to verify this claim. The committee recommended the creation of an independent authority to oversee coal pricing and procurement, the issuance of new NEPRA guidelines for long-term coal purchases, and stricter transparency measures. The committee recommended setting up an independent authority to regulate coal pricing and procurement.