Power tariff increases by 19 paisas per unit

The National Electric Power Regulatory Authority (Nepra) on Friday notified an increase of 19 paisas per unit in the power tariff on account of fuel charge adjustment (FCA) for August 2022.

The power regulator said that the Central Power Purchasing Agency (CPPA-G) had filed a petition on behalf of Discos to increase the power tariff by 22 paisas per unit.

This will put an additional burden of over Rs2 billion on consumers. However, the increase will not be applicable to K-Electric (KE) consumers.

The regulator is expected to issue a detailed decision soon.

Meanwhile, the power regulator notified a reduction of Rs4.89 per unit in electricity rates for KE consumers on account of FCA for the month of August 2022. The decision and subsequent reduction to consumers will apply for the billing month of October 2022 and will provide a breather of over Rs7 billion to KE consumers.

In case of Discos’ tariff, the CPPA-G also claimed a negative amount of Rs1,844.8 million as previous adjustment.

The authority observed that the CPPA-G claimed a cost of Rs83.2 million for Uch-Il power plants for the period from FY2014 to FY2016 due to verification of PPA factors and revision in rates by the Oil and Gas Regulatory Authority.

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Since the same requires detailed calculations and verification of technical section, therefore, the power regulator had not considered this cost while working the instant monthly FCA.

As per the data submitted by CPPA-G, XWDiscos purchased 17.77 GWh from Captive Power Plants (CPPs) during August 2022 for which the CPPA-G provided actual details of energy purchased from these plants.

According to the details provided by the CPPA-G, the actual fuel cost of this energy is Rs84.530 million. The amount, as per the Nepra-approved mechanism, has been considered while working out the FCA for August 2022.

In the FCA decision for July 2022, the authority directed the CPPA-G to provide details of net metering units purchased by all XWDiscos along with its subsequent monthly FCA request. The CPPA-G in compliance with the authority's direction provided the distributed generation/net metering information for consideration of the authority.

However, the CPPA-G during the hearing requested the authority not to consider the units of distributed generation/net metering, stating that a proper billing mechanism needed to be developed before accounting for such units in the monthly FCA of XWDiscos.

The authority has acceded to the request of the CPPA-G and decided not to consider the exported units billed at National Average Power Purchase Price, keeping in view its insignificant impact. The power regulator directed the CPPA-G to ensure a proper mechanism for the accounting of such units.

Fine on Mepco

Meanwhile, Nepra imposed a fine of Rs28 million on the Multan Electric Power Company (Mepco) for its gross negligence resulting in fatal accidents during the period from July 2020 to December 2021.

The authority, upon receipt of reports of 16 deaths in different electrocution incidents during the aforementioned period, constituted a two-member investigation committee under Section 27A of Nepra Act 1997 to visit the respective areas, conduct investigation, ascertain and determine the facts and possible violations of Nepra laws, rules and regulations.

The investigation committee’s report revealed that 11 out of the total 16 fatalities occurred due to Mepco’s negligence. These fatalities included four of Mepco’s employees and seven persons from the general public.

Keeping this in view, the authority issued a show-cause notice to Mepco on May 17, 2022 under Section 27B of the Nepra Act, 1997 and later provided an opportunity of hearing to Mepco on July 4, 2022. Based on the evidence, record and submissions made by Mepco invoking the relevant provisions of the laws, rules and regulations; the authority observed that Mepco failed to discharge its statutory obligations to maintain safety standards as laid down in the relevant laws, code and manual.

The authority, therefore, imposed a fine of Rs28 million on Mepco. The authority directed Mepco to provide compensation of Rs3.5 million each to the bereaved families. The authority also instructed Mepco to ensure provision of jobs to the dependents of the deceased families and documentary evidence of the same be submitted to the authority.