NEPRA slashes power tariff by Rs0.31 per unit

Cut comes on account of fuel cost adjustment for November 2018

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Thursday approved a tariff reduction of Rs0.31 per unit on account of fuel cost adjustment for November 2018.

The regulator took the decision at a public hearing. Consumers will be reimbursed Rs2 billion in the electricity bills of next month. The reference fuel cost was set at Rs5.04 per unit but the actual price came in at Rs4.71 for November, showing a reduction of Rs0.33 per unit.

The Central Power Purchasing Agency-Guarantee (CPPA-G) had requested the regulator to allow for the adjustment of Rs5 billion. However, Nepra decided to verify claims before taking any decision on the adjustment.

The adjustment will be available to domestic consumers throughout Pakistan, except for K-Electric consumers. Domestic consumers using up to 300 units per month will also be excluded from the adjustment. In the past, there was more use of high-speed diesel in power plants, adding billions of rupees to the energy costs borne by consumers. However, a major decline in power tariff came as a result of no consumption of high-speed diesel and less use of furnace oil later.

According to the CPPA-G, about 7,545.63 gigawatt-hours (GWh) of electricity was generated in November 2018, of which 7,318.16 GWh were delivered to distribution companies with about 2.84% transmission and distribution loss. It said the share of hydroelectric power production in the overall energy mix in November stood at 33.98%. Wind and solar plants contributed about 1.68% and 0.64% energy respectively at no fuel cost.

Power generation by furnace oil-based plants had 0.08% share at a cost of Rs16.5 per unit. Natural gas-based power generation contributed 20.04% at a cost of Rs5.18 per unit. Power generation by imported LNG-based plants contributed 17.23% to the overall power supply at a rate of Rs10.13 per unit. Energy contribution from coal plants was 13.83% and its fuel cost came in at Rs6.58 per unit. The electricity imported from Iran contributed around 0.52% at a cost of Rs11.57 per unit.

Published in The Express Tribune, December 28^th, 2018.

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