KAPCO Enters Tri-Party Power Agreement

Kot Addu Power Company Limited (KAPCO) has formalized a Tri-Partite Power Purchase Agreement (TPPA) with the Central Power Purchasing Agency (CPPA-G) and the National Grid Company of Pakistan Limited (NGCPL). This information was shared with the Pakistan Stock Exchange (PSX) in an announcement on Wednesday.

NEPRA’s Approval

Last month, specifically on May 20th, the National Electric Power Regulatory Authority (NEPRA) greenlit the tripartite agreement. This agreement governs the sale of electricity generated by KAPCO’s 1,600 MW power facility situated in Kot Addu, Punjab. According to the notification issued by KAPCO, NEPRA’s endorsement of the TPPA occurred on May 19, 2025, but is contingent upon fulfilling specific prerequisites.

Conditions for Operational Phase

The stipulated conditions involve the execution of an Initial Capacity Test (ICT) and a Heat Rate Test (HRT) to establish baseline efficiency metrics. An independent engineer will assess and determine the Simple Cycle Efficiency/Heat Rate figures. Upon successful completion of these stipulations, the TPPA will be enacted for the power plant’s operational duration.

Provisional Tariff Granted

In the meantime, NEPRA had previously accorded a provisional tariff to KAPCO on a Take-or-Pay basis last month, subsequent to a public hearing convened on April 8, 2025. KAPCO, established in 1996, manages a multi-fuel power station boasting a 1,600 MW capacity, supplying electricity to the Water and Power Development Authority (WAPDA) under a Power Purchase Agreement (PPA).