Federal Minister for Power Division Sardar Awais Ahmed Khan Leghari has taken serious notice of the off-take of electricity by Distribution Companies (DISCOs) from Small Power Producers (SPPs) and Captive Power Plants (CPPs) at rates exceeding the national merit order, the Ministry of Energy (Power Division) said on Wednesday.

The issue came to light during a routine stock-taking session of DISCOs held in Islamabad.

Leghari directed an immediate halt to the practice, demanding that power off-take align with the National Electric Power Regulatory Authority (NEPRA) Grid Code, Distribution Code, and relevant directives.

In addition to halting the off-merit procurement, the minister also ordered an inquiry into the matter to investigate the discrepancies. The inquiry will examine whether DISCOs have adhered to the economic merit order (EMO) principles in their procurement of electricity.

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He emphasized coordination with the Integrated System and Market Operator (ISMO) to incorporate SPPs and CPPs into the power dispatch process, ensuring the least cost to consumers.

In line with the minister’s directions, the Power Division has issued strict instructions to all DISCOs, mandating that no off-merit procurement of power from SPPs be conducted without prior approval from ISMO.

Furthermore, the off-take from SPPs will be limited to instances where the electricity falls within the national merit order, based on the prescribed incremental cost of the generation mechanism.

This move aims to enhance transparency in the power procurement process and reduce the financial burden on consumers.