Proposed Hike In Electricity Tariff Rejected

ISLAMABAD: In a rare move, the National Electric Power Regulatory Authority (Nepra) on Wednesday put on hold about Rs3 per unit increase in electricity tariff for consumers of ex-Wapda distribution companies (Discos) under monthly fuel adjustment for lack of evidence.

At a monthly public hearing, Nepra Chairman Tauseef H. Farooqi said “it would be a burden on our conscience if we pass on to consumers the entire expensive power generated on furnace oil,” when surplus capacity on cheaper fuels was available. The regulator directed the Central Power Purchasing Agency (CPPA) — the petitioner on behalf of all Discos — to provide justification along with evidence for generating expensive electricity on furnace oil.

It also called for plant-wise details of available capacity across the generation system and how the furnace oil-based plants made up to the economic merit order so that a fresh hearing could be conducted on Tuesday next.

Farooqi said the exchequer appeared to have been burdened with additional Rs7.2 billion because of utilisation of expensive fuel oil and questioned why the cheaper sources were not optimally utilised. “We need to know the compulsion along with proof thereof for use of expensive furnace oil”, he said. ARTICLE CONTINUES AFTER AD The CPPA representatives told the regulator that merit order was followed during the month of September except where unavoidable due to system constraints and load balancing compulsions. The CPPA had sought an increase of Rs2.97 per unit under fuel price adjustment for the month of September for Ex-Wapda Discos. In its petition, the CPPA reported total energy generation in September at 13,621 GWh at a total price of Rs70.231bn or Rs5.1560 per kWh.

The net electricity delivered to Discos stood at 13,225 GWh at cost of Rs76.886bn or 5.8136 per kWh. About 2.91pc losses were reported at transmission stage. The CPPA said that since the actual generation cost amounted to Rs5.8136 per unit against a reference price of Rs2.8410 per unit, the Discos should be allowed to recover another Rs2.97 per unit from consumers in the coming month. It was reported that the share of hydropower generation stood at 37pc in September against 40pc in August which has no fuel cost. The share of coal-based energy generation stood at 16.39pc at a cost of Rs5.3770 per unit. About 6pc contribution came from furnace oil at a cost of Rs16.56 per unit in September compared to its 3.6pc share in August at a cost of Rs12.51 per unit. About 21pc electricity came from Regassified Liquefied Natural Gas based plants at a cost of Rs11.12 per unit.

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