Fuel adjustment formula: Revised power tariff in Feb 2014 bills

Hike will not apply to K-Electric consumers.

ISLAMABAD:

The National Electric Power Regulatory Authority (Nepra) announced on Thursday that a revised tariff of power distribution companies (Discos) will be adjusted in the electricity bills for February 2014.

Nepra had raised the power tariff of power distribution companies (Discos) for December 2013 by Rs1.01 per unit according to the monthly fuel adjustment formula.

The increase will be applicable across the board, save for consumers of K-Electric (formerly the Karachi Electric Supply Company).

Nepra increased the tariff for December 2013 after examining the actual fuel charges for the month.

According to information provided by the Central Power Purchasing Agency (CPPA), the actual fuel charge for December 2013 was Rs8.8714 per kilowatt hour (kWh) against the reference fuel cost component of Rs7.8690 per kWh.



The actual fuel charge, as such, was increased by Rs1.0024 per kWh.

Discos purchased 104.27 gigawatt hour (GWh) from small and captive power plants for the month of December 2013, the details provided by CPPA revealed. The actual fuel cost of this power amounted to around Rs1.02 billion.

While calculating the fuel adjustment for December 2013, however, Nepra did not include the cost component from those plants which had cases against them pending in court. As such, the authority only considered the purchase of 41.61 GWh – at the cost of Rs533.46 million – for the instant fuel adjustment for December 2013.

According to CPPA, the National Transmission and Dispatch Company (NTDC) lost 240.03 GWh on account of transmission losses in December 2013. However, Nepra assessed transmission losses at a rate of 3%, as determined in a July 19, 2013 statutory regulatory order.

CPPA has already reduced the overall cost on account of transmission losses in excess of 3% by Rs281 million. As such the impact of increased transmission losses has not been passed on to consumers.

After reviewing and incorporating various adjustments, Nepra increased the applicable for Discos for December 2013 by Rs1.0103 per kWh.

 

Published in The Express Tribune, February 7^th, 2014.