ISLAMABAD – May 24, 2025: The National Electric Power Regulatory Authority (NEPRA) has approved K-Electric’s (KE) multi-year tariff (MYT) for its distribution and transmission segments covering a *seven-year period from FY2023-24 to FY2029-30, with a projected revenue requirement of *Rs50.284 billion for FY2024-25.
As part of the new tariff structure, NEPRA approved an average increase of Rs3.31 per unit in distribution charges. Additionally, KE has been allowed Use of System Charges (UoSC) revenue of Rs43.447 billion for FY2023-24, also reflecting an impact of around Rs3.30 per unit, subject to change upon investment plan approval.
Importantly, these tariff revisions will *not affect end-consumer electricity rates, which remain regulated under the *national uniform tariff policy.
NEPRA’s final determination followed a public hearing held on June 27, 2024, with participation from several stakeholders, including Karachi-based interveners.
In its MYT proposal, KE had sought a 16% return on equity (RoE) for distribution and *15% for transmission, but NEPRA approved a more conservative *14% RoE for distribution and 12% for transmission.
K-Electric emphasized that, as a private sector entity *without government guarantees, it relies on long-term financing where *predictable cash flows are vital. The approved seven-year tariff control period aligns with KE’s investment horizon and facilitates access to loans that typically span *10–12 years, with assets having a life of *10 to 30 years.
KE argued that a shorter control period would disrupt financing, hinder project viability assessments, and jeopardize future investments in its transmission and distribution infrastructure.
The approved MYT provides KE with a stable regulatory framework, enabling long-term planning and investment in Karachi’s energy infrastructure while maintaining protections for consumers through the uniform national tariff mechanism.
Story by Mushtaq Ghumman
