National Electric Power Regulatory Authority (Nepra) has notified Quarterly Tariff Adjustment (QTA) of Rs 1.65 per unit to be effective from October 1, 2021 for consumers using up to 700 units per month which has replaced previous QTA of Rs 1.62 per unit, posting an increase of paisa 3 per unit.
According to Nepra, the Authority has determined QTA of paisa 82.76 per unit for fourth quarter of 2019-20 and Paisa 89.66 per unit for first and second quarter of 2020-21, totalling to Rs 1.7242 per unit. However, after determination of negative adjustment of Paisa 6 per unit for third quarter of 2020, the total positive impact has been calculated at over Paisa 3 per unit, to be applicable from October 1, 2021.
This implies that QTA of Rs 1.62 per unit expired on September 30, 2021 and new QTA of Rs 1.66 per unit will be applicable from October 1, 2021. The government has imposed a surcharge of Rs 1.25 per unit on inefficient Discos to bring their QTA at par with inefficient Discos.
This QTA has been replaced on the submission of the Federal Government specifically with respect to the periodic adjustments for 4th Quarter of FY 2019-20, whereby, the Ministry stated that right of reconsideration as provided through the Amendment Ordinance, per the settled principles of interpretation of the law, would also be available for the 4th quarter determination of the Authority.
According to Nepra considering the submissions made by the MoE in its request and during the hearing and keeping in view the interest of consumers, the Authority has accepted the request of the Federal Government that the effectiveness of the recommended periodic adjustments for the 1 & 2 quarters of the FY 2020-21, be made effective from October 1, 2021 i.e., after the lapse of the existing quarterly adjustments i.e., September 30, 2021.
Accordingly, the quarterly adjustments for 1 & 2 quarters of the FY 2020-21, determined by the Authority on May 6, 2021 would be applicable from October 1, 2201 and would remain applicable till September 30, 2022.
Regarding quarterly adjustment for the 4th quarter of FY 2019-20, the Authority believes that since it will be in the interest of the consumers; therefore, the Authority has no objection if Federal Government desires to make it effective from October, 2021.
Nepra argues that deferment of quarterly adjustments to be made applicable from October 01, 2020 is purely being done on the request of the Federal Government; therefore, any financial impact arising on account of delayed application of the determined quarterly adjustments, would not be allowed to be passed on to the consumers and would be borne by the Federal Government, itself.
Regarding surcharges proposed by the Federal Government for various categories of consumers, Nepra has clarified that it has not levied any such surcharges and that it is the Federal Government which has the statutory power to do so.
Under Section 31(8) inserted through Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Ordinance, 2021, the Federal Government has the power to levy surcharges and any such surcharge is to be considered as a cost to be included in tariff determined by Nepra.
Through a reconsideration request, it has been intimated by the Federal Government that it has levied surcharges and Nepra is simply required to indicate such amounts against the corresponding columns of Nepra determined schedule of tariff.
Nepra has only been requested vide the instant reconsideration request to simply indicate the surcharges imposed by the Federal Government in exercise of its powers, against the uniform rate of quarterly adjustments for the purpose of recovery only. Therefore, category wise surcharges proposed by the Federal Government have accordingly been included in the instant decision.