ISLAMABAD - National Electric Power Regulatory Authority (NEPRA) Thursday increased the power tariff for the distribution companies (XWDiscos) and K-Electric by Rs9.89 per unit and Rs 11.37 per unit respectively on account of monthly fuel charges adjustment (FCA).

In a public hearing on the petitions of XWDiscos, the regulator noted that efficient power plants were under utilized in June, which has burdened the consumers with extra Rs 37.37 million. The hearing was presided over by Chairman NEPRA Tauseef.H.Farooqui.

In a petition submitted to NEPRA, on the behalf of power distribution companies (XWDISOCs), the CPPA-G said that for the month of June the reference fuel charges from the consumers were Rs 5.9344/unit while the actual fuel cost was Rs 15.8439/unit. The CPPA-G requested that it should be allowed to pass the increase of Rs 9.9095/unit to the consumers.

CPPA had sought a previous adjustment of more than Rs 10b in its request. The impact of system constraints was Rs73.86 million during June, the Nepra official informed. The shortage of LNG caused a burden of Rs 776.96 million. Expensive power plants were commissioned to generate electricity in June, the authorities informed.

The regulator expressed displeasure at NTDC’s performance. The performance of NTDC is worst compared to DISCOs, member Sindh Nepra Rafiq Sheikh remarked during hearing. He said that that the condition of NTDC is so bad that is threatening the people lives. “We are tired of listening to people’s complaints, NTDC is a complete mess,” Member Sindh Nepra. He said that NTDC has a very big role in the destruction of the country. The regulator made two adjustments to the demand made by CPPA-G. The first adjustment is related to M&E which is Rs 111.25 million (0.0082/unit) and adjustments by technical –auxiliary of NTDC and energy Rs 0.0041/unit. It has been decided that the increase will be Rs 9.8972/unit.

Chairman NEPRA asked Power Division officials, will there be loadshedding, if spot LNG is not purchased for power generation? What strategy will the government adopt? he further asked. The CPPA officials informed that coal supply for power generation has improved. They are also taking steps to keep the grid stable, the official added. Earlier, NEPRA conducted public hearing on the petition of KE on fuel charges adjustments (FCA) for June 2022. The utility, in its petition for FCA, had sought an increase of Rs 11.389/unit.

Electricity price has been increased on account of monthly fuel charges adjustment

The regulator was informed that the major impact on the monthly FCA of June 2022 is due to an increase in the prices of RLNG, furnace oil, and power purchased from CPPA-G. The price of RLNG in June 2022 has increased by 50pc from March 2022. The price of furnace oil in June 2022 has increased by 42pc from March 2022. Meanwhile, the price of electricity from CPPA-G in June 2022 has increased by 74pc from March 2022.

During the hearing, Aamir Ghaziani – K-Electric’s Chief Financial Officer, also briefed the regulatory authority about the utility’s strategy to mitigate the impact of rising FCAs in the future. Aamir Ghaziani commented that KE is undertaking various steps to reduce dependence on imported fuel for power production in its service territory. He also said that the utility has planned to add around 1,000 MW of electricity via renewable sources by 2030, which would also be inexpensive. He further stated that KE has allied with Sindh Energy Department (SED) and the World Bank to develop a solar park with an aggregate capacity of 350 MW under the ambit of the ‘Sindh Solar Energy Project’ (SSEP) upon the completion of which, the power would be inducted into KE’s grid via power off-take agreements. Furthermore, KE also has plans to off-take 100 MW from another solar-powered plant based in Balochistan as well as it has 300 MW of energy produced by wind in the pipelines as well.

The regulator made two adjustments to the KE FCA claim. The first adjustment is related to difference due to cost Rs 0.009/unit and under utilization of efficient source Rs 20 million or 0.01/unit. The regulator has worked out the increase to be Rs 11.37/unit for the KE consumers on account of June FCA. The hike on account of FCA will have an impact of approximately Rs 182bn (FCA+17pc GST) on the power consumers of XWDiscos and KE. This increase will not be applicable to lifeline consumers. NEPRA has reserved the judgment and will issue it after further scrutiny of the data. The additional amount will be charged from the consumers during August bills.