Unveiling of the CTBCM by Power Div has taken place
The Competitive Trading Bilateral Contract Market (CTBCM) has been officially launched in Pakistan, marking a significant step towards a greener, more efficient, and competitive energy sector. The leadership of the CTBCM has been taken over by the Independent System and Market Operator (ISMO), which is responsible for organizing stakeholder consultations and implementing the power market reforms.
The CTBCM reforms are designed to facilitate the integration of renewable energy sources, reduce energy costs for industries, and create opportunities for export-oriented sectors to access green, reliable, and affordable power. Industrial bulk power consumers will particularly benefit from wheeling arrangements, enabling them to directly procure electricity at competitive prices from the supplier of their choice.
The CTBCM auction framework, a cornerstone of the CTBCM implementation, aims to allocate 800MW of wheeling demand to market participants. Successful bidders in the CTBCM auction will have obligations, including getting necessary licenses, signing contracts, and providing performance guarantees before starting wheeling. The marginal price of every hour will be calculated as the energy imbalance amount per kWh for that hour.
The auction framework includes questions about marginal price, Use of System Charges (UoSC), cost of service, and stranded capacity. The government is seeking stakeholder input on the auction guidelines and process to ensure effective auctions. The ISMO shared details of the auction framework for 800MW of wheeling demand in a workshop, which was formally inaugurated by the Federal Minister Sardar Awais Leghari.
The Minister contended that this reform is essential for Pakistan's economic growth and electricity market liberalization, and pledged political and institutional support for its successful implementation. The Minister emphasized that all market participants have valuable insights to share in shaping a fair, functional, and future-oriented market.
The CTBCM is central to the government's vision for transforming the electricity sector in Pakistan. It is not just about the power sector; it is about the economy, the environment, and the wellbeing of the people. The reforms, as argued by Federal Minister Sardar Awais Leghari, are a guarantee for Pakistan's energy future and aim to stabilize electricity prices in the country.
The CTBCM auction framework includes the calculation of energy imbalance on an hourly basis and consolidation on a monthly basis for settlement. To qualify for the CTBCM auction, companies must be registered, have the required interconnection studies, and in most cases have agreements with bulk power consumers.
The CTBCM is designed to bring greater transparency, efficiency, and competitiveness to the sector, drawing on global best practices. The government's commitment to seeking stakeholder input and the ISMO's responsibility for operating the country's power system, administering the competitive electricity market, and leading long-term planning, are promising signs for the success of the CTBCM.
Commercial operations for the CTBCM are expected to begin by the end of September. As the reforms progress, Pakistan moves one step closer to a sustainable, affordable, and reliable energy future.
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