Nepra slightly reduces electricity price

Nepra has issued a notification according to which a reduction of 44 paisas per unit in the price of electricity in the context of monthly fuel charges adjustment for April 2021 has been approved.

According to the notification, the Central Power Purchasing Agency-Guarantee (CPPAG) had requested a reduction of 84 paisas per unit while the authority had temporarily reduced the fuel charges for August and October 2020 by Rs7.5 billion.

The reduction will apply only to the bills for June, while it will be applicable to all Distribution Companies (DISCOS) users except 300-unit users, lifeline and agricultural customers.

Earlier, on June, 4, Karachi Electric (K-E) has sought additional charges of over Rs5.6 billion from consumers through the monthly Fuel Cost Adjustment (FCA) for the four months (January-April) of 2021.

According to reports, in its application to the National Electric Power Regulatory Authority (NEPRA), the Karachi-based private power utility has requested the regulator to pay an additional Rs7.174 billion for three months under the monthly FCA.

Further, it has also requested to allow transfer of Rs1.60 billion for the refunds for next month.

In addition, a further 37 paisas per unit increase in tariff has been demanded under the quarterly adjustment.

In its application, K Electric has claimed a quarterly adjustment in fuel costs for the January-April period and a quarter ending in March under the Multi-Air Tariff (MYT) 2017-2023.

Under the monthly FCA for January, February and March, KE has requested a transfer of Rs7.174 billion, while FCA for April has requested 87 paisas per unit reduction.

For January, KE has requested an increase in tariff of Rs1.978 per unit, which would enable the company to collect Rs2.53 billion from Karachi power consumers.

For February, it has requested an increase of Rs2.495 per unit to raise an additional Rs2.77 billion.

Similarly, for March, the company has requested an increase of Rs1.497 per unit in tariffs to transfer a burden of Rs2.34 billion to consumers.

On the other hand, it has sought 87 paisas per unit reduction in fuel cost adjustment with an impact of about Rs1.6 billion.

According to the procedure provided in Multiyear Tariff (MYT), KE has made a quarterly adjustment in tariff for January to March due to changes in the purchase price (PPP) of electricity other than fuel, impacts of transmission and operational losses.

In this case, KE has demanded an increase of 37 paisas per unit in tariff.

It should be noted that Quarterly Adjustments (QTAs) are subject to the approval of the government.

NEPRA will hold a public hearing on the petitions on June 15 and has sought answers to several questions from the interveners for the hearing.

At the public hearing, NEPRA will determine whether changes in the required fuel prices and quarterly changes are justified.