Nepra raises electricity prices by Re53/unit

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ISLAMABAD: The federal government Monday notified up to Rs2.89 per unit hike in power tariff for K-Electric consumers effective from September 1. The Power Division notified the increase from Rs1.09 to Rs2.89 per unit. The K-Electric will increase the power price from September 1. The notification states, “In pursuance of sub-section (7) of Section 31 of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997, the federal government is pleased to notify as under the adjustment approved on account of quarterly adjustments wef September 1, 2020 as determined as recommended by National Electric Power Regulatory Authority (NEPRA) vided decision of dated December 31, 2019 in respect of K-Electric Limited,” the Power Division said in notification.” The Power Division said the recommended quarterly adjustment to the tune of Rs4.87 being differential between the schedule of tariff recommended by Nepra for April-June 2019 and the schedule of tariff earlier recommend by Nepra and reflected in the K-E notification be notified for each category of consumer to the extent of bringing K-Electric consumers end tariff on a par with what is currently in field for consumer of XWDISCC (increase in rate of Rs1.09 to Rs.2.89/kWh for various categories of consumers) approved/ratified by the Cabinet Division on September 11, 2020. Any difference between the two rates be made available by way of subsidy which shall amount to Rs26 billion only. The base tariff for the K-Electric was Rs11.22 per unit, which would be increased by up to Rs2.89 per unit following the notification. The Nepra had determined an increase of Rs4.87 per unit or 44 percent in power tariff on account of previous years’ adjustments. The total revenue impact of tariff hike of Rs4.87 per unit was nearly Rs106 billion.

The National Electric Power Regulatory Authority (NEPRA) has approved an increase of Re 53 per unit in the price of electricity for distribution companies.

A statement issued by NEPRA said, “NEPRA held an online hearing on the matter on January 27, 2021, in Islamabad and advertisements were also placed in the newspapers in this regard.”

According to the statement, representatives of Central Power Purchasing Agency (CPPA), National Power Control (NPCC), NTDC were present at the hearing while WAPDA Power Privatization Organization, Sui Southern Gas Company, Sui Northern Gas Pipeline. No representatives from the Ministry of Energy and the Ministry of Finance attended.

“NEPRA has approved the addition of fuel adjustment under Section 31 VII of the Amendment Act, 2011 of the Regulation of Generation, Transmission and Distribution of Electric Power Act,” the statement said.

“It has been approved in terms of fuel adjustment charges for December 2020,” the statement said.

According to NEPRA, the increase will be applicable to all customers except those using less than 50 units and the increase should be highlighted in the bills.

Consumers will have to pay additional charges in February 2021 bills which will be on a per unit basis in December.

It may be recalled that NEPRA had last month approved an increase of Rs 1.06 per unit for consumers as a monthly fuel adjustment for October and November 2020.

The report said the increase would cost the deficit-ridden energy sector Rs 8.4 billion.

The statement said that Discus had demanded an increase of Rs 1.53 per unit in the price of electricity, which was expected to raise Rs 12.5 billion.

The order issued after the hearing said that in general, the efficient power plants were not fully utilized and electricity was generated from expensive RFO and high-speed diesel (HSD) power plants resulting in Rs 2.011 billion. As a result, Rs 1.88 billion came to RFO and Rs 131 billion to HSDA account in October 2020.

NEPRA said the survey found that the EMO had claimed Rs 863 million from the total loss due to shortage of regasified liquefied natural gas (RLNG), technical shortcomings and non-use of efficient plants. Rupees are deductible.

The order said that after the approval of the fuel adjustment, an increase of 29 paise per unit is expected to raise Rs 2.9 billion in October and an increase of 77 paise in November to Rs 5.5 billion.

NEPRA had said that after transmission losses, DISCOS could have been supplied 7,235 gigawatt-hours at a cost of Rs 24.9 billion at Rs 3.35 per unit.

The documents showed that the largest share of the grid station was 31% of hydropower, an increase of 40% in November.

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