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Nepra all set to allow Rs9.98 per unit reduction in K-Electric’s power tariff

Nepra all set to allow Rs9.98 per unit reduction in K-Electric’s power tariff

ISLAMABAD-National Electric Power Regulator Authority (Nepra) is all set to allow K-Electric a reduction of Rs9.983 per unit in power tariff on account of monthly and quarterly adjustments.

In a public hearing on the KE’s petition for monthly fuel charges adjustments for October, NEPRA has calculated a reduction of Rs 2.15/unit in tariff, while for the quarterly adjustments for the 1st quarter (July to September) of FY2022-23 the regulator has decided to reduce the tariff by Rs 7.833/unit.

In a public hearing presided over by Chairman NEPRA Tauseef. H.Farooqi over KE’s petition on account of FCA for October 2022, the regulator has allowed a reduction of Rs 2.15/unit which will provide a relief of Rs 3.75 billion to KE’s power consumers. For the month of October, K-Electric had requested the regulator to allow the company to return Rs1.883/unit back to power consumers on account of monthly FCA. However, the regulator after initial scrutiny had calculated a reduction of Rs 2.15/unit on account of monthly FCA. During hearing, NEPRA official informed that K-Electric had generated electricity from its own resources at average rate of Rs32.96/unit, while the company had purchased electricity from CPPA at Rs 12.1/unit.

According to the KE, the negative FCA for October 2022 is primarily due to a decrease in prices of RLNG, furnace oil, and power purchased from CPPA-G. The price of RLNG in October 2022 decreased by 16% from September 2022. The price of furnace oil in October 2022 has decreased by 6% from September 2022, and the price of power purchased from CPPA-G in October 2022 has decreased by 6% from September 2022. 

The hearing was informed that K-Electric had generated electricity from high speed diesel at Rs 45.43/unit and from furnace oil at Rs 40/unit. Chairman NEPRA asked KE’s official that why was electricity generated from diesel in October? “Was Nepra notified in advance to generate electricity from diesel?,” Tauseef.H.Farooqui asked. The chairman further said that there is no need at all to run expensive plants. Chairman Nepra said that he is not completely satisfied with the performance of K-Electric. However, KE official said that the rules related to power generation have been implemented. The NEPRA official said that violation of merit order resulted in an additional burden of Rs 1.6b on the power consumers in October. NEPRA has also conducted hearing on the KE’s petition for the quarterly adjustments for the 1st quarter (July to September) of FY2022-23. The KE had also sought the regulator nod for a reduction of power tariff by Rs7.833/unit on account of quarterly adjustments. The regulator has approved the KE’s request and will forward its judgment to the federal government for final notification. Commenting on the reduction of Rs7.833/unit reduction in tariff on account of quarterly adjustment, the spokesperson of the KE said that the impact of quarterly adjustments is usually not passed to consumers under the uniform tariff policy applicable across the country. However, the final decision rests with the Federal Ministry of Energy, Government of Pakistan, and the NEPRA Authority. NEPRA will issue detailed decision later. This adjustment/relief would be available to all the user categories of KE except lifeline power consumers, domestic consumers consuming up to 300 units, agricultural consumers, and electric vehicle charging stations (EVCS).

Source: The Nation

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