Nepra raises electricity rates by Rs1.90/unit

Consumers to experience impact on their bills from July 2023 due to variations in fuel charges

ISLAMABAD:

The National Electric Power Regulatory Authority (Nepra), on Thursday, has issued a notification for another increase in electricity rates, raising it by Rs1.90 per unit on account of fuel adjustment for the month of May 2023. The power regulator reviewed and assessed a National Average Uniform increase of Rs.1.9039/kWh in the applicable tariff for XWDISCOs, taking into account the variations in fuel charges during May 2023.

The increase comes after the Central Power Purchasing Agency (CPPA) demanded to raise power tariffs by Rs2.05 per unit. However, Nepra approved a slightly lower increase of Rs1.90 per unit.

The impact of this tariff hike will be reflected in the electricity bills of the ongoing month, July 2023.

CPPA-G has purchased energy of 34.499 GWh from Tavanir Iran in May 2023, incurring a cost of Rs811.6 million. Additionally, CPPA-G claimed a net negative amount of Rs366.53 million as a previous adjustment in the Fuel Cost Adjustment (FCA) for May 2023.

During the hearing, the authority observed that expensive power plants were generating energy during the same month. Nepra has been directing NPCC/NTDC and CPPA-G repeatedly to provide complete justification for this and to submit detailed information about deviations from the Economic Merit Order (EMO), including hourly generation and the financial impact of such deviations.

The power regulator also directed CPPA-G to scrutinise the dispatch report in terms of Scheduling and Dispatch Code (SDC) of Grid Code and prepare a report comprising all dispatch deviations from the merit order. While CPPA-G submitted the required data along with the monthly FCA data of May 2023, it was not in line with the authority’s requirements. Therefore, CPPA-G was directed to resubmit the report in the desired format for the authority’s consideration.

During May 2023, the System Operator curtailed the drawl of energy from efficient power plants due to reasons such as transmission line outages, contractual obligations, transmission network congestion, and overloading. This underutilisation of efficient plants resulted in a financial impact of Rs48.82 million. Nepra has withheld a financial impact of Rs1.67092 billion from the FCA claim for the month of May 2023 due to deviation from the EMO by NPCC, which is part of NTDC. The authority directed CPPA-G to pass on the impact of such deduction to NTDC.

NTDC reported provisional T&T losses of 262.48 GW1I (2.260%), based on energy delivered on their system during May 2023. It is noteworthy that the amount arising due to the application of PPA factors for the six RFO-based IPPs incorporated under the 2002 Power Policy is being allowed on a provisional basis and will be subject to adjustment based on the final outcome of the ongoing sue mote proceedings against these IPPs.

Furthermore, Nepra directed CPPA-G to provide technically and financially verified data of each generation company for the previous month along with the next monthly FCA request to ensure timely adjustments. CPPA-G included 34.559 GWh for the Net Metering units procured during May 2023 in their request.

The authority decided to hold a detailed discussion with stakeholders on the treatment of energy procured through bilateral contracts and net metering. A discussion meeting was held on February 9, 2023, during which Nepra directed the MOE and CPPA-G to provide their written comments on the matter and for any such future bilateral contracts by DISCOs.

Published in The Express Tribune, July 21^st, 2023.

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