ISLAMABAD-National Electric Power Regulatory Authority has allowed K-Electric to recover Rs3 per unit subsidy availed by the industrial consumers during July to December 2019 within two months.
Nepra, while vetting the Supreme Court’s decision which has stated that subsidy is the prerogative of the government and they can withdraw it, has allowed K-Electric to recover Rs 3/unit subsidy availed by the consumers on account of industrial relief package from July to December 2019.
The decision issued by Nepra said that the Authority, pursuant to the judgment of the Honorable Supreme Court of Pakistan dated January 19, 2023, issued its decision in the matter on October 31, 2023. The decision was intimated to the federal government for notification in light of Section 31 of NIEPRA Act.
Subsequently, the MoE submitted that the Authority decided instant case on the request of K-Electric to adjust the tariff for the period July 2019 to December 2019. In view thereof, the MoE requested that control implementation period may be clarified in the subject decision.
The Authority considers that the tariff adjustment period comprises of six months i.e. July 2019 to December 2019, and recovery of the same has already been delayed. Therefore, it would be appropriate to implement the same in a period of two months. Accordingly, the implementation period shall be two months from the date of notification of the said decision.
The federal government on January 01, 2019 had allowed a relief package for industrial consumers of XWDISCOs and K-Electric whereby it was notified that payment for the industrial consumers of all XWDISCOs and K-Electric be reduced by Rs.3/unit. The impact of SRO 12(1)/2019, was built by the federal government in the Schedule of Tariff (SoT) of K-Electric, which was notified vide SRO.575(I)I2019 dated May 22, 2019, whereby, the industrial tariff of K-Electric consumers was reduced by Rs.3/unit for both peak and off peak hours.
Subsequently, the federal government vide SRO.810(I)/2019 dated 12.07.2019 amended the SRO.12(I)/2019 with effect from July 1, 2019, whereby it was decided that payment for industrial consumers of all XWDISCOs and K-Electric be reduced by Rs.3/unit only during the peak hours. However, as the relief of Rs.3/unit was built in the SoT of K-Electric, notified vide SRO 575(1)12019, therefore, withdrawal of relief of Rs.3/kWh for other than peak hours from industrial consumers of K-Electric could not be implemented, as the SRO was not modified accordingly.
The federal government, vide corrigendum dated January 22, 2020, revised the rates of Industrial Supply Tariff in K-Electric’s SRO.575(I)/2019 dated 22.05.2019, by substituting the revised rates for industrial consumers other than peak hours, to give effect to SRO.810(I)/2019 dated 12.07.2019, to be effective from July 1, 2019. Based on the corrigendum dated January 22, 2020, K-Electric reversed the subsidy earlier provided to industrial consumers, for the period July 2019 to December 2019 and started the recovery of the amount from the industrial consumers. The matter was challenged by the consumers’ in Sindh High Court and later in the Supreme Court of Pakistan.
Supreme Court decided that the appeals and petitions filed by the consumers are dismissed and the matter concerning the adjustment of SRO.810(I)/2019 is referred back to NEPRA for its determination and the issuance of a Schedule of Tariff (SoT) amending the uniform tariff for K-Electric. K-Electric has also requested NEPRA to adjust the uniform tariff of K-Electric for the period from July 2019 to December 2019, so that removal of subsidy, consequent to SRO.810(I)/2019 is duly reflected by passing a determination and issuance of SoT in compliance of the decision of the Supreme Court of Pakistan. The instant decision is intimated to the federal government for notification in light of Section 31 of NEPRA.