ISLAMABAD - National Electric Power Regulatory Authority has allowed a hike of Re0.57 per unit in power tariff of K-Electric, which will raise the company’s average tariff to Rs 26.08/unit.

The increase of Re.0.5715/unit will be applicable for a period of three months w.e.f. August 2022 to October 2022, on the consumption of June 2022, July 2022 and August 2022 respectively, said a notification issued here NEPRA. In its motion submitted to NEPRA, the Ministry of Energy had proposed an increase of Re.0.5715/unit on the consumption of June, July and August 2022 to be recovered from consumers in July to September 2022, respectively, however, since the month of July 2022 has lapsed, therefore, the same may be recovered from consumers in August to October 2022, based on the consumption of June, July and August 2022 respectively, said a notification issued here.

NEPRA had conducted public hearing on the federal government motion with respect to Consumer End Tariff Recommendations of KE which will increase the price of electricity by 0.57/unit for K-Electric’s consumers for the first quarter of FY 2021-22.It is pertinent to mention here that the consumers of XWDiscos are already paying Re. 0.5715/unit in their bills. According to NEPRA, the current average electricity tariff of KE is Rs 25.52/unit. If approved, K-Electric’s average tariff will be Rs 26.08/unit.

The Authority had determined Periodic Adjustment in Tariff for the 1st Quarter of FY 2021 -22 for XWDlSCOs having uniform rate of Rs. 0.5715/unit for three months period. In accordance with the National Electricity Policy, the government may maintain a uniform consumer-end tariff for K-Electric and state-owned distribution companies (even after privatization). Accordingly, KE applicable uniform variable charge is also required to be modified so as to recover the revenue requirements of KE, determined by the Authority consistent with the uniform national tariff of XWDlSCOs. The same has been approved by the federal government and it was decided that the same be submitted to the Authority for consideration in terms of the provisions of the Act. Instant motion is being filed by the federal government with respect to Consumer End Tariff Recommendations of K-Electric, under section 7, 31(4) and 31(7) of the Act read with Rule 17 of the Rules so as to reconsider and issue for K-Electric, modified uniform variable charge, to maintain uniform tariff across the country, to recover the revenue requirements of K-Electric determined by the Authority keeping in view the proposed targeted subsidy and cross subsidies.

The federal government during the hearing submitted that as per the National Electricity Policy 2021 (Section 5.6.3), in view of various parameters, including (a) the socio-economic objectives; (b) budgetary targets in field; and (c) recommendations of the Regulator with respect to consumer-end tariff for each state-owned distribution company, the government may continue to propose uniform tariff across the consumers and regions. In pursuance thereto, the Regulator shall, in public consumer interest, determine a uniform tariff (inclusive of quarterly adjustments) for all the state-owned distribution companies. Additionally, government may maintain a uniform consumer-end tariff for K-Electric and state-owned distribution companies (even after privatization) through incorporation of direct / indirect subsidies. It was also explained that despite the proposed increase of Rs.0.5715/unit, the government would still be picking-up a subsidy of around Rs.3.98/unit from the NEPRA determined tariff, which would increase in future after the Authority determines the Quarterly Adjustment of K-Electric for the quarter ended June 2022.

The Authority has considered the submissions made the federal government in the motion and during the hearing. The Authority noted that the instant Motion has been filed by the federal government to make the tariff uniform across the country keeping in view the National Electricity Policy 2021. The Authority further observed that despite the proposed increase of Re.0.5715/ unit for all categories of the consumers except life line, the federal government would be picking up subsidy of Rs.3.98/unit as explained by the government during the hearing. In view of the above, the Authority has decided to accept the motion filed by the federal government. However, regarding request of the federal government to incorporate the proposed increase in the SoT determined for the quarter Oct.-Dec. 2021 or in the latest SoT for the quarter Jan.-Mar. 2022, with prospective application, the Authority has decided to issue a separate SoT for the allowed increase of Rs.0.5715/unit for all categories of consumers except life line. The decision said that the increase will be applicable for a period of three months and the amount so allowed shall be accounted for by K-Electric in its subsidy claims. The federal government is also requested to adjust this amount while processing the subsidy claims of K-Electric.