Amir Saeed

Pakistan’s power market is entering a decisive phase with the imminent rollout of the Competitive Trading Bilateral Contract Market (CTBCM).

The announcement of the Uniform System Operator Charges (UOSC) at Rs12.55/kWh, pending formal notification by National Electric Power Regulatory Authority, suggests that the wholesale electricity market may finally be operational within the next two months, said Ammar Kharal, an energy sector expert.

Talking to WealthPK, he said: “For decades, our system has functioned under the single-buyer model, where inefficiencies, rigid contracts, and the absence of consumer choice have locked the power sector into a cycle of circular debt and financial distress,” he said. “CTBCM represents a historic opportunity to break that cycle by introducing transparency, efficiency, and competition.”

Explaining the reform, he said CTBCM will allow generators and consumers to enter into bilateral contracts for the first time in Pakistan’s history. “This will not only rationalise costs but also hold market players accountable in ways the current framework does not,” he observed.

He added that the reform would fundamentally reshape the role of key institutions. “Distribution companies (Discos), traditionally passive buyers and sellers under government directions, will become active participants in a competitive market.

“Market and system operators will have clearly separated responsibilities, ensuring transparency and bolstering investor confidence. At the heart of this transformation lies the Market Commercial Code (MCC), which will govern trading, contracting, and dispute resolution.”

Kharal cautioned, however, that the transition would not be without challenges. “Market liberalisation often brings short-term difficulties, such as price volatility and adjustment costs, before the benefits of efficiency and competition begin to materialise,” he said. “That is why governance, regulation, and stakeholder preparedness will be critical.”

He stressed that the country must seize this moment. “The wholesale market is no longer a distant concept, it is just around the corner,” he told WealthPK. “If implemented wisely, CTBCM can empower consumers, attract investment, and gradually ease the financial strain on the power sector. But if mismanaged, it risks becoming another lost opportunity.”

Credit: INP-WealthPk