NEPRA defers ruling on tariff relief

Petition seeks reduction of Rs0.71 per unit under fuel charges adjustment

ISLAMABAD:

The National Electric Power Regulatory Authority (Nepra) on Wednesday reserved its judgement on the request for a tariff relief of Rs0.71 per unit to electricity consumers on account of fuel charges adjustment for September 2024.

The power-sector regulator, in a statement, said that the authority reserved its decision at a public hearing and it would be issued later.

It said that the Central Power Purchasing Agency-Guarantee (CPPA-G) requested a tariff reduction of Rs0.71 per unit under the monthly fuel charges adjustment for September. If approved, the consumers will get a relief of Rs8.5 billion.

The regulator added that the reduction would be applicable to all consumers of power distribution companies (DISCOs) except for lifeline and prepaid service consumers as well as electric vehicle charging stations.

During the hearing, various stakeholders came up with arguments and raised several questions over the efficiency of power companies.

It was informed that more electricity was generated from hydel and nuclear resources in September as compared to other sources of power generation.

In its petition, the CPPA-G also requested permission for the recovery of previous adjustment of Rs7.5 billion from the consumers.

It was pointed out that peak hours had shifted from midnight to 1am due to solarisation and the reduction in consumer demand.

CPPA-G officials revealed that peak demand was calculated at 16,000 megawatts at midnight, which came down to 13,000MW in the morning. Owing to the closure of Neelum Jhelum hydroelectric power plant, the production of hydel electricity dropped, the hearing was informed. Similarly, less-than-anticipated electricity was generated by some coal-fired plants, which prompted the regulator to raise several queries.

"What are the reasons and why this has happened as less power has been generated from coal resources," it asked.

However, the officials concerned failed to satisfy Nepra, whose chairman pointed out that the plant had been on outage as per schedule. "I am sorry that the authorities do not come prepared," remarked Nepra chief, adding that an inquiry committee formed by the prime minister was working on the Neelum Jhelum project.

He pointed out that repair cost of the Neelum Jhelum project had not yet been estimated, adding that there was a need to come up with a solid number, as only then the government would be able to decide what to do.

Nepra chairman stressed that nothing could be said with certainty until the prime minister approved the inquiry report.

According to the data submitted for the public hearing, in September 2024, hydel generation stood at 4,838 gigawatt hours (GWh), which accounted for 38.75% of total generation.

Power generation from local coal-fired plants was calculated at 1,261 GWh, which comprised 10.10% of total generation, at a price of Rs12.2882 per unit.

With the help of imported coal, 1,149 GWh of electricity was generated at a cost of Rs16.5990 per unit, which consisted of 9.20% of total production. High-speed diesel was not used for power generation during the month under review while 39 GWh was produced from residual fuel oil at a cost of Rs30.2960 per unit.

Gas-based power plants produced 988 GWh (7.91% of the total) at Rs13.6768 per unit while re-gasified liquefied natural gas-fired plants generated 2,039 GWh (16.33% of the total) at Rs24.9570 per unit.

Electricity generation from nuclear sources totalled 1,596 GWh at Rs1.5417 per unit (12.78% of total production) and electricity import from Iran stood at 40 GWh at Rs25.9519 per unit. Power generation from bagasse was recorded at 36 GWh at a price of Rs12.4788 per unit. Some 395 GWh was generated by wind mills, which comprised 3.17% of the total, while solar energy produced 105 GWh, which accounted for 0.84% of total generation.

In September, total energy production reached 12,487 GWh at a basket price of Rs8.3380 per unit. Total energy cost stood at Rs104.114 billion.

However, with the proposed previous adjustment of Rs7.505 billion and the sale of electricity by the independent power producers at negative Rs1.402 billion, the net electricity delivered to DISCOs in September came in at 12,118 GWh at a cost of Rs9.0949 per unit and the total price of Rs110.05 billion.

CPPA-G argued that against the reference fuel cost of Rs9.8006 per unit, the actual cost was calculated at Rs9.0949 per unit, hence, a negative adjustment of Rs0.7057 be approved.