Power consumers are set to get a relief of over Rs2 per unit due to reduction in electricity rates on account of fuel adjustment charges for the month of January 2025.
The National Electric Power Regulatory Authority (Nepra) conducted a public hearing on Thursday to consider a petition submitted by the Central Power Purchasing Agency (CPPA) to cut power tariff up to Rs2.0019 per unit.
CPPA officials informed the power regulator that actual fuel rate stood at Rs11.0081 per unit against reference price of Rs13.0100 per unit, registering a reduction of Rs2.0019 per unit due to variation in energy cost.
The electricity consumers will get a total relief of Rs15.65 billion in their electricity bills. The consumers are expected to get a relief in their March electricity bills.
During the hearing it was informed that hydropower contributed 10.63% to the total electricity generation, while local coal accounted for 15.56%, with a cost of Rs12.54 per unit. Imported coal, despite a lower share of 8.53%, was significantly more expensive at Rs20.96 per unit.
The share of RLNG stood at 18.92%, costing Rs22.47 per unit, while furnace oil-based generation, though minimal at 1.34%, had the highest cost at Rs30.34 per unit. Nuclear energy remained the cheapest source, covering 26.61% of the generation mix at just Rs1.81 per unit. Additionally, electricity imported from Iran, constituting 0.41% of the total supply, came at a cost of Rs26.34 per unit. The total energy delivered to DISCOs stood at 7,816 GWh.
Relief to Agriculture Sector
The Power Division informed during the hearing that a separate request has been submitted to NEPRA, seeking a reduction in electricity prices specifically for the agricultural sector. The Power Division sent this request to NEPRA, aiming to provide negative Fuel Cost Adjustment (FCA) relief to farmers using agricultural tube wells and domestic consumers, consuming up to 300 units of electricity.
However, Power Division representatives clarified that no additional subsidy for agricultural tube wells has been included in the budget. NEPRA officials assured that providing FCA relief to agricultural consumers would not negatively impact the industrial sector.
It was also disclosed that the Sahiwal power plant operated with 65 per cent imported coal. Additionally, the net relief amounting to 74 paise per unit is likely to be passed on to consumers in March. Under the winter package, 63 percent of electricity consumption was attributed to industries, while the remaining 37 percent belonged to other consumer categories.
Despite the introduction of a winter package, electricity sales did not see a significant increase. Officials attributed the decline in agricultural and industrial electricity consumption to increased solar energy adoption. Many agricultural consumers have shifted towards solar-powered solutions, while industrial consumers are also exploring alternative energy sources.
NEPRA officials expressed concerns over declining hydropower generation due to lower-than-expected rainfall and snowfall. They have sought further details from the Water and Power Development Authority (WAPDA) regarding the expected water availability during the summer season.
A separate issue regarding the implementation of General Sales Tax (GST) on solar net metering has reached NEPRA. However, the Power Division stated that it has yet to receive any formal decision from the Federal Tax Ombudsman (FTO). Officials said that the matter might eventually be referred to the Federal Board of Revenue (FBR) for further deliberation.
Chairman Nepra asked the power division to check this issue. Officials responded that they would check from FBR and would inform the power regulator.
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