ISLAMABAD: Public sector power distribution companies (Discos) have sought approval from the National Electric Power Regulatory Authority (Nepra) to refund Rs1.69 per unit to consumers, amounting to around Rs23 billion, on account of lower fuel costs in July. The adjustment, if approved, will be reflected in electricity bills for August.
According to the Central Power Purchasing Agency (CPPA), the decline in fuel costs was largely driven by improved hydrological conditions, with hydropower contributing 40% of generation in July compared to 36% last year. Overall power consumption, however, fell 5% year-on-year in July, though it was 2.6% higher than June 2025.
Nepra has scheduled a public hearing on August 28 to review the petition. The refund will also apply to K-Electric consumers, following a recent Economic Coordination Committee (ECC) decision to ensure uniformity across the country’s tariffs. Nepra has already notified a negative fuel cost adjustment (FCA) of 78 paisa per unit for the current billing cycle.
In July, electricity generation stood at 14,123 gigawatt hours (GWh) at an average cost of Rs7.78 per unit, while 13,666 GWh was delivered to Discos at Rs8.18 per unit. RLNG remained the most expensive generation source at Rs22 per unit, followed by imported coal (Rs14.49), local gas (Rs13.38), and furnace oil (Rs31, contributing less than 1%). Nuclear power and renewables continued to provide the cheapest electricity, at Rs2.42 per unit and near-zero fuel cost, respectively.
The FCA mechanism allows monthly variations in fuel costs to be passed directly to consumers, while quarterly tariff adjustments cover broader cost factors such as capacity charges and distribution losses.
Story by Khaleeq Kiani
