NEPRA raises tariff by Rs2.6 per unit
PHOTO: FILE
Amid criticism over paying trillions of rupees to the Independent Power Producers (IPPs) and protest by Jammat-e-Islami, the National Electric Power Regulatory Authority (Nepra) on Thursday made another increase in electricity rates by up to Rs2.5627 per unit that would be recovered from consumers in electricity bills of August.
The power regulator has allowed state-run power distribution companies (DISCOs) to collect an additional Rs2.5627 per unit from power consumers in their August bills.
The hike will put an additional financial burden of Rs33.45 billion on the power consumers. However, with the imposition of 18 percent GST, the total burden will jack up to Rs39 billion.
The adjustment is due to the monthly fuel charges adjustment (FCA) for June 2024, which covers the gap between the actual cost of power generation and what was previously charged.
The rise in the costs was driven by high prices of liquefied natural gas (LNG) and oil, coupled with lower electricity demand
The adjustment will apply to all consumer categories except electric vehicle charging stations (EVCS) and lifeline consumers.
Notably, DISCOs had sought permission to charge an additional Rs2.63 per unit from the power consumers in their August bills. It claimed that the reference fuel cost for June was set at Rs7.14 per unit, but the actual fuel cost turned out to be Rs9.77 per unit.
During a public hearing on July 31, Central Power Purchasing Agency (CPPA) CEO, while presenting the case before the authority, submitted that there was slightly lower generation from Hydro and Local Coal as compared to generation assumed in reference tariff.
He also explained that the Neelum-Jhelum Hydropower Project could not be operated due to the forced outage and consequently no payments were made to it.
However, certain fuels which were not a significant part of the reference mix such as RLNG were operated because of system requirements and contractual obligations. The actual generation remained 10 percent lower than anticipated.
A representative of NTDC/NPCC submitted that on a year-on-year basis the generation has decreased by 2 percent. It was further submitted that the peak demand during the month was 22,971 MW while the lowest demand achieved during the month was 10,092 MW.
CPPA said that in June, 13,459 gigawatt-hours (GWh) of electricity were generated at a fuel cost of Rs119.7 billion (Rs8.89 per unit), with 13,071 GWh delivered to distribution companies at Rs127.7 billion (Rs9.77 per unit).
Consumption dropped 1.9 percent from June 2023, while the Rs2.63 per unit fuel cost adjustment (FCA) for June 2024 was 40 percent higher than last year's Rs1.88/unit.
Hydropower led the supply with 35 percent, followed by LNG at 18 percent, nuclear at 14.85 percent, local coal at 11 percent, and local gas at 8.66 percent. Imported coal contributed 4.74 percent. The cost of LNG-based generation rose to Rs26.32 per unit, while domestic gas increased slightly to Rs13.93 per unit. Local coal costs fell to Rs11.1 per unit, and imported coal dropped to Rs15.5 per unit.
Renewable sources such as wind, bagasse, and solar contributed 5.14% of the grid's supply, with bagasse generation costs remaining steady at Rs6 per unit.