KAPCO seeks over 100% raise in power tariff

NEPRA to hear power company’s request on October 3

ISLAMABAD:

Kot Addu Power Company (Kapco) has submitted an application to the National Electric Power Regulatory Authority (Nepra) for the approval of an electricity tariff, which, if green-lighted, will be the most expensive in the country’s history.

The company has requested the power regulator to allow it to charge a tariff of Rs77.31 per unit from its consumers.  At present the power company charges Rs28.80 per unit.

Nepra will hear the company's request in a meeting on October 3 at 2pm. All stakeholders, interested or affected persons and the general public can join the virtual meeting to be held via Zoom.

In its notice for hearing published in newspapers, NEPRA has sent 17 questions to the power company regarding the tariff.

The production tariff includes capacity payments of up to PKR 5.37 per unit.

A capacity payment is made by a user of an energy asset to the owner of that asset in return for the rights to utilize the asset's capacity. Capacity payments are most utilized for power plants in the electric industry and for pipelines in the natural gas industry.

Kapco was established in accordance with the Power Policy of 1996. The license for the company, with a capacity of 1345 megawatts, expired in 2021 but it was extended later. According to the law, a power company should be shut down upon the expiration of its license.

Kapco generates electricity from gas, furnace oil, diesel, and liquefied natural gas (LNG).