Power rates to go up by 26 paisa

(Nepra) has given the green light for a 26 paisa per unit increase in electricity tariff for July.

Express August 24, 2010

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has given the green light for a 26 paisa per unit increase in electricity tariff for the month of July.

The permission for tariff hike was granted to electricity distribution companies under a monthly fuel price adjustment formula. Nepra is expected to notify the increase on Wednesday (today).

Sources said Nepra allowed the tariff increase after meeting with all stakeholders.

The electricity distribution companies had originally sought a 52 paisa per unit increase in tariff for the month.

Nepra officials said that although a 26 paisa per unit increase has been allowed, consumers will actually receive bills with a 38 paisa per unit reduction because a 64 paisa per unit increase had been allowed in June.

At the hearings, the distribution companies took the plea that production cost on furnace oil during July came to Rs9.81 per unit, therefore the IPPs had to pay Rs1.79 billion as supplementary charges.

The companies petitioned the regulator to allow these charges together with line losses to be shifted to consumers. However, Nepra rejected the plea and allowed only a 26 paisa hike.

The companies had sent their applications through the Central Power Purchasing Agency (CPPA), stating that their total production cost on electricity supplied to consumers in July came to Rs4.61 per unit whereas the reference price set by the government was Rs4.09 per unit.

Therefore, they pleaded, they should be allowed to effect a 52 paisa per unit increase in tariff to cover the difference.  According to Nepra sources, the cost per unit was found Rs4.35, therefore, an increase of 26 paisa was allowed.

Published in The Express Tribune, August 25th, 2010.


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