The National Electric Power Regulatory Authority (Nepra) has permitted the Central Power Purchasing Agency (Guarantee) Limited (CPPA-G) to raise salaries, bonuses, and performance increments for the fiscal year 2025-26. This decision comes despite widespread inefficiencies, poor performance, and governance issues plaguing the power sector.
Approved Salary and Benefits
Nepra allowed a salary increase based on a 4.49% average inflation rate (Consumer Price Index) plus performance increments averaging around 6%, resulting in a total increase of 10.49%—slightly below the 11% requested. The approved salary cost stands at Rs1.585 billion, with employee benefits of Rs249 million. CPPA-G had requested Rs199 million (1.5 times gross salary) for bonuses, but Nepra approved one basic salary amounting to Rs55.64 million.
Staffing and Recruitment
The regulator approved costs for 26 already-hired employees, totaling Rs109.71 million, while noting that future recruitments will require separate justification. CPPA-G had proposed hiring dozens of additional employees, but Nepra did not approve these new positions.
Training and Consultancy Cuts
Nepra slashed the training budget from Rs32 million requested to Rs8.58 million, based on actual expenditure, citing that the market operator function has shifted to ISMO. The regulator rejected hiring for headhunting consultants, succession planning consultants, and a compensation survey. It allowed Rs1 million for testing services and Rs0.7 million for a board evaluation consultant, plus Rs2 million for tax consultants.
Administrative and Other Expenses
The company sought Rs316 million for administrative costs, but Nepra allowed Rs271.11 million. Major reductions included telephone and communication expenses, board and audit fees, outsourced services, and insurance costs. All ESG (environmental, social, and governance) expenses were disallowed, with the regulator stating such CSR-type activities should not be passed on to electricity consumers.
IT and Capital Expenditure
CPPA-G requested Rs241 million for repair, maintenance, and IT services; Nepra approved Rs137 million, with reductions in IT services, vehicle expenses, and repair and maintenance. For capital expenditures, the company asked for Rs164 million, but the regulator approved only essential operational expenses, significantly cutting several requested costs.
