Govt notifies up to Rs2.89 per unit hike in KE tariff

Power utility’s tariff would now be on a par with other power distribution companies

ISLAMABAD:

The federal government on Monday notified a hike in the power tariff by up to Rs2.89 per unit for the K-Electric consumers to bring them on a par with the rest of the country, with effect from September 1, 2020.

The Power Division issued a notification in this regard stating  “the federal government is pleased to notify as under the adjustment in the approved tariff on account of quarterly adjustments with effect from September 1, 2020, as determined and recommended by the National Electric Power Regulatory Authority (Nepra)” vide its decision dated December 31, 2019, in respect of KE.

With this increase, the KE’s tariff would now be on a par with other power distribution companies.

Last month, the Economic Coordination Committee (ECC) of the cabinet had approved the summary moved by the Power Division for “the rationalisation of eleven quarterly adjustments of K-Electric from July 2016 to March 2019”.

The Nepra had recommended a Rs4.87 per unit increase in the average rate of KE or 44% on account of previous years’ quarterly adjustments but the ECC decided to allow a maximum rise of Rs2.89 per unit. The ECC decision was approved by the federal cabinet on September 11.

The base tariff for the K- Electric was Rs11.22 per unit, which would be increased by up to Rs2.89 per unit following the notification.

Based on Nepra’s determination, the ECC had approved in March this year an average Rs2.39 per unit increase in KE tariff to bring it on a par with uniform national power tariff. This tariff had been pending for almost three years.

In summers, this comes to around Rs3 billion per month and drops to about Rs2 billion or averages out at about Rs2.5 billion.

Its application was stopped due to the Covid-19 pandemic at the time. The ECC again gave a go-ahead for its implementation with effect from July 1, 2020, but was again withheld by the federal cabinet and the premier on the request of the PTI members of the cabinet from Karachi amid floods and load-shedding.

However, as the problems continued, KE was assured during a meeting at the Governor's House of an immediate increase in its consumer-end tariff.

The KE tariff at present is Rs2.89 per unit lower than the rest of the country for almost all commercial categories, temporary residential, all bulk supply tariff, public lighting, residential colonies attached to industrial premises, and all industrial tariff categories.

The power utility’s tariff for all residential consumers is Rs1.65 per unit lower than the rest of the country.

The KE tariff for commercial consumers on less than 5kwatt load is Rs1.09 per unit lower than the rest of the country.