ISLAMABAD  -  The stakeholders Thursday grilled National Electric Power Regulatory Authority (Nepra) over renewing generation license of K-Electric’s 40 years old power plants, having generation cost of up to Rs58.44 per unit, allowing it take or pay clause and dollar indexation in its generation license.

A representative of Jamat-I-Islami Karachi chapter termed the Nepra hearing a fixed match between the regulator and KE and alleged the authority of rubber stamping all the demands of the power company.

National Electric Power Regulatory Authority has conducted a public hearing on the KE’s petition for fuel charges adjustment for the month of September, where the company sought the regulator’s approval for paying back Re0.16 per unit to its consumers, which it had charged extra in the month of September. The request, if approved, will provide a relief of Rs247 million to the consumers.  During hearing, Nepra was informed that the price of electricity taken from CPPA-G was Rs8.57 per unit, while the average cost of electricity generated from KE’s own power plants was Rs23 per unit.

The KE official further said that electricity demand has decreased by 6 percent in September. The industrial demand has decreased by 12 per cent and residential by 3 per cent during the month, the officials added.

The reason for the decrease in demand for electricity is the economic conditions, officials said. Representative of Jamaat-e-Islami Karachi, Shahid Imran alleged that NEPRA is favouring KE and providing the tariff of the company’s choice.

KE has generated the most expensive electricity for 19 years, Imran said. NEPRA has granted a seven-year license to reward KE, he alleged.

He said that 40 years old power plants with expensive generation have been granted generation licenses for 7 years. Similarly, he said as against the federal government policy of termination of take or pay clause with IPPs, Nepra had granted it to KE. The dollar indexation is granted by the KE, he said and added that it should be withdrawn.

While appreciating Member Nepra Mathar Rana for his note on the authority decision, on KE generation license, said that the rest of the authority is favouring KE. He said that Jamaat-e-Islami Karachi rejects the generation license given to KE and demanded that it should cancelled. He said that KE should get its electricity from the national grid which is far cheaper than KE’s own generation.

Member Nepra Rafiq Shaikh said. “If anyone has any objection to the tariff, he should file a review.” Representative of Karachi Chamber of Commerce, Tanveel Bari said that the people of Karachi are getting expensive electricity as compared to the rest of the country.

Tanveer Bari said that the electricity generation cost of K-Electric is up to Rs58.44 per unit. Under the monthly fuel charges adjustment for September, other Discos got more relief, while Karachiites are getting only Re0.16 per unit, he maintained.

Arif Balwani said that the KE reduction is only Re0.16 per unit, while for Discos it is Re0.71 per unit. He asked KE that was the decrease of Re 0.16 per unit due to the cheaper supply from the national grid. Official of the KE said that there are other factors too and the cheap supply is one of it. He said that the generation from furnace oil was also decreased during the month, which is also one of the reasons. Against the reference generation of 195 GWh, through furnace oil, or 13 per cent of the total generation the actual generation was 38 GWh or only 2 percent. Nepra has reserved the judgment and will release it after further scrutiny.