ISLAMABAD: Prime Minister Shahid Khaqan Abbasi has rejected a proposal to transfer National Transmission & Despatch Company (NTDC) under the administrative control of the Ministry of Water Resources or make it an associated company of the Water and Power Development Authority (Wapda).

Responding to a summary moved by the Ministry of Water Resources (MWR), the prime minister has conceded that the reforms introduced in the 1990s to segregate power sector from Wapda were too slow and still half way, yet the wheels should go on nevertheless instead of going back.

The MWR and Wapda had argued that the transmission sector used to be part of the centralised Wapda and was very effective in planning transmission lines with priority of the major power projects for evacuation of electricity.

They said while the bifurcation of two sectors led to power generation coming through private power and infrastructure board, alternative energy development board, and other agencies including provincial departments, there was no centralised planning for transmission lines that caused evacuation challenges. The transmission line priorities, therefore, were set by the influence of the power plant sponsors and not on the basis of cost effectiveness.

For example, the focus on thermal power production overlooked the importance of major hydropower plants in terms of evacuation to a stage that the NTDC did not care for the transmission line for 969MW Neelum-Jhelum hydropower project until it reached advanced stages of implementation and then prime minister had to be involved to set timelines for its transmission lines.

Likewise, the Golen Gol project in Chitral had been ready by a few kilometres of transmission line for its evacuation was missing until the Wapda raised red flags again at the level of prime minister as the coordinated development of transmission lines suffered.

Therefore, the MWR and Wapda viewed that since NTDC was not on the privatisation agenda given it has to take care of the national grid, it would be advisable to link Wapda and NTDC in view of future focus on hydropower development.

They said this had become all the more important after bifurcation of water and power divisions – creation of Ministry of Water Resources and Power Division becoming part of the Ministry of Energy. They proposed that “either NTDC should be made an associated company of Wapda or place it under the administrative control of the Ministry of Water Resources.”

The prime minister rejected the proposal saying it was not justified. He agreed that power sector reforms in the 1990s, the unbundling of Wapda in 2007, and the recent bifurcation of the Water and Power Division were progressive steps to separate the domain of water resources from the domain of power.

Also, Mr Abbasi ruled that hydropower did not account for more than one-fourth of the installed power generation capacity of the country while matters relating to electric utilities were the subject of the power division under the Rules of Business 1973.

On top of that, “NTDC is responsible for making and overseeing arrangements for evacuation and transmission of power generated from thermal, hydroelectric, solar and other sources, and, as such, naturally aligned with the power division, which is entrusted with the primary responsibility of exploring and developing power resources in the country.”

Published in Dawn, January 30th, 2018