KE seeks Rs5.6bn in Jan-April fuel cost adjustments

SLAMABAD: The K-Electric has sought more than Rs5.6 billion worth of additional charges from consumers through monthly fuel cost adjustments (FCAs) for four months (January to April 2021) of the current calendar year.

In its petition to the National Electric Power Regulatory Authority (Nepra), the Karachi-based private integrated power utility has requested the regulator to allow transfer of an additional financial burden of Rs7.174bn for three months under monthly FCAs and about Rs1.6bn refund for another month.

In addition, it has also sought another 37 paisa per unit increase in tariff under quarterly adjustments.

In its petition, the KE has claimed fuel cost charges for period of January to April and quarterly adjustment for the quarter ending in March under Multiyear Tariff (MYT) 2017-2023.

Under monthly FCA for January, February and March, the KE has requested to transfer the burden of Rs7.174bn while FCA for April it has requested 87 paisa per unit reduction.

For January, KE has requested for an increase of Rs1.978 per unit in tariff which will allow the company to collect Rs2.053bn from the power consumers of Karachi.

For February, it has requested for tariff increase of Rs2.495 per unit to collect an additional Rs2.773bn. Similarly, for March, the company has requested to increase the tariff by Rs1.497 per unit to pass on the burden of Rs2.348bn to consumers. On the other hand, its has sought 87 paisa per unit reduction in fuel cost adjustment with an impact of about Rs1.6bn.

KE has also filed a separate request for quarterly adjustment for January to March in tariff on account of variation in Power Purchase Price (PPP) other than fuel, impact of transmission and operational losses on fuel charges variation, as per the mechanism provided in the MYT determination. In this case, KE has sought to increase the tariff by 37 paisa per unit. QTAs are subject to government approval.

Nepra will conduct public hearing on June 15 and has placed several questions from interveners for the hearing. The public hearing would determine if requested fuel price variations and quarterly variations sought are justified and if the KE had followed the economic merit order while giving despatch to its power plants as well as power purchases from external sources.

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