ISLAMABAD: Power consumers across Pakistan are likely to face an increase of approximately Rs1.74 per unit in electricity tariffs in upcoming bills after the Central Power Purchasing Agency (CPPA) sought more than Rs16 billion in additional recoveries through a higher Fuel Cost Adjustment (FCA).
The request was reviewed during a public hearing conducted by the National Electric Power Regulatory Authority (Nepra), where the CPPA proposed an additional Rs1.73 per unit FCA for electricity consumed in April 2026 and billed next month.
CPPA Chief Executive Officer Rehan Akhtar informed the regulator that the reference fuel cost for April had been set at Rs8.25 per unit, but the actual cost reached Rs9.975 per unit. He attributed the increase primarily to disruptions in global LNG supplies caused by the US-Iran conflict, which significantly raised generation costs.
According to the CPPA, technical limitations in transmitting cheaper electricity generated in Sindh to demand centres in northern regions also contributed to the higher fuel adjustment. With the expiry of a small negative adjustment already in place, the net impact on consumers is expected to reach Rs1.74 per unit.
The agency noted that the government’s decision to limit power generation from costly furnace oil and diesel plants helped contain the tariff increase. Special LNG procurement arrangements were also introduced, reducing the effective LNG cost charged for power generation and preventing a steeper rise in electricity prices.
Officials further disclosed that reduced availability of the Karachi Nuclear Power Plant Unit-2 (K-2) due to technical issues and forced outages contributed to higher generation costs. In addition, past claims amounting to Rs3.4 billion related to the plant were included in the adjustment calculations.
During the hearing, Nepra was informed that electricity supplied from the national grid to Karachi had benefited both K-Electric and national grid consumers. Rehan Akhtar stated that without this support, consumers would have faced a combined increase of Rs4.26 per unit, including higher fuel and capacity charges.
The CPPA also reported a significant decline in electricity demand during April 2026. Overall power consumption fell by 8.5% year-on-year, with notable decreases across domestic, commercial, agricultural, and bulk consumer categories. However, industrial electricity consumption increased by 13.5%, driven by restrictions on captive gas-based power generation and the government’s incremental tariff package.
Industrial representatives from Karachi criticized the incremental tariff package, arguing that its design had limited benefits to only a small segment of consumers. They urged the government to review the policy to make it more effective and inclusive.
Separately, Nepra expressed concern over growing complaints regarding excessive loadshedding in Karachi amid intense summer temperatures and directed K-Electric to submit a detailed report urgently.
The regulator noted that complaints were being received from both high-loss and low-loss areas, indicating that announced load management schedules were not being properly followed. Nepra officials also raised concerns that power outages caused by technical faults were not being transparently reported under loadshedding schedules, potentially violating regulatory standards.
K-Electric, which participated in the hearing online, assured the regulator that a detailed report would be submitted promptly.
In a statement issued after the hearing, a K-Electric spokesperson maintained that the utility’s loadshedding practices comply with the National Electricity Policy 2021 and attributed localized outages to ongoing infrastructure and development work carried out by civic authorities across the city.
The final decision on the proposed fuel cost adjustment will be announced by Nepra after reviewing stakeholder feedback and the data presented during the hearing.
Story by Khaleeq Kiani
