ISLAMABAD-The electricity consumers in Pakistan will get a relief of approximately Rs31 billion in their next bills as the National Electric Power Regulatory Authority (Nepra) on Tuesday indicated a reduction of Rs10.80 per unit and Rs2.32 per unit in tariffs of K-Electric (KE) and Ex-WAPDA power distribution companies (XWDiscos) respectively, on account of monthly fuel adjustment.
National Electric Power Regulatory Authority (Nepra) has conducted two separate hearings on the petitions of Central Power Purchasing Agency (CPPA-G) and KE for tariff reduction on account of monthly FCA for December 2022. The public hearings were presided over by Taseef H. Farooqui, chairman Nepra, and attended by members of the authority.
In its petition, the CPPA-G said that for the month of December the reference fuel charges from the consumers were Rs 9.3193/unit while the actual fuel cost was Rs 7.1198/unit. Therefore it should be allowed to refund Rs2.1995/unit, which it had overcharged from the consumers of Ex-Wapda Distribution Companies (XWDiscos) during the month. However, according to preliminary data analysis by NEPRA, the reduction is Rs 2.32/unit, the regulator said. The consumers will get a relief of 18.7b in their February bills.
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During the hearings, NTDC authorities came under fire over a lack of planning and inefficiencies for not laying a network to evacuate power from Thar coal projects. It was informed that Thar coal power plants with 2400MW capacity had been completed. However, NTDC was able to evacuate only 1800 MW which resulted in a loss of Rs 587.6 million. It was further informed that loss should either be borne by NTDC or the regulator would have to shift it to the consumers. The power regulator had given a deadline of three days to the NTDC to explain why it had failed to make proper plans to evacuate power from Thar coal projects that had been completed. These projects were based on a take or pay basis and therefore, NTDC would have to pay if it is unable to evacuate the power. Who is responsible for the loss due to not laying network to evacuate power, Chairman Nepra questioned. He also raised questions about NTDC’s performance and lack of proper planning. NTDC authorities also drew attention to make previous adjustment of Rs 4.9 billion claims which had been verified by the auditors. Auditors were conducting an audit of Rs 30 billion previous adjustment. An audit of Rs 13 billion had been conducted so far. However, Nepra authorities said that they were still examining the data. Nepra also gave deadline of four weeks to complete the audit.
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Nepra also raised question over changing of General Manager at NPPC several times and adhocism was also being tipped in recent power blackouts. Pointing toward the recent power breakdown, an intervener said that the officers of the attached departments of the Power Division are getting the highest pays/perks, while their performance is nil. The higher salaries of NTDC and employees of other attached departments of Power Division also came under discussion; who were receiving higher salaries, but their performance was poor which was evident during the recent blackout. They had also failed to lay a transmission network to evacuate power from the Thar coal power projects in Sindh which had resulted in multimillion-rupee losses. Chairman Nepra further said that the inquiries were being held to know the reason for recent blackouts. During the hearing on KE’s petition, it was informed that the company had submitted a request for reduction of Rs 10.26 per unit on account of monthly fuel adjustment for December. However, after the initial data analysis, NEPRA has indicated a reduction of Rs 10.80/unit. The reduction in KE’s tariff would result in providing relief of Rs 12b to KE customers in their February bills .
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During the hearing, it was informed that furnace oil consumption in KE’s own power plants dropped which was a major reason of reduction in electricity price. Nepra stressed on KE to install wind and solar based power plants in Jhimpir where the power infrastructure was already in place. KE officials said that they were also focussing on renewable energy and they had submitted RFP to Nepra for wind power projects. They said that KE would float bid to install wind power plants. They were targeting 2023 and 2024 to start receiving electricity from wind power plants. The reduction will not apply to lifeline consumers, domestic customers using up to 300 units, agricultural customers and electric vehicle charging stations. The regulator will issue its detailed decision after further scrutiny of the data.