NEPRA likely to jack up tariff by Rs2.51 per unit

Decision to have impact of Rs39bn on power consumers

ISLAMABAD: Power consumers are likely to face a tariff increase of Rs2.51 per unit on account of fuel cost adjustment for September 2021 which the National Electric Power Regulatory Authority (NEPRA) is expected to announce in the near future after scrutiny of necessary data.

According to sources, if NEPRA approves Rs2.51 per unit increase in electricity price then consumers will face an additional burden worth more than Rs39 billion. However, this hike in power price will not be applicable on lifeline consumers and K-Electric consumers.

Following an application of Central Power Purchasing Agency (CPPA) to increase the power price by Rs2.66 per unit under the head fuel charges adjustment for September 2021, NEPRA on Wednesday had convened a public hearing to consider the proposed adjustment.

In the petition submitted to the  authority on behalf of power distribution companies, the CPPA said that in September, the reference fuel cost for the consumers was Rs5.0229 per unit while the actual fuel cost came in at Rs7.6816 per unit. Therefore, it should be allowed to pass on the increase of Rs2.6587 to the consumers. If approved, the tariff increase will have an impact of Rs37 billion on the power consumers.

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During the hearing, NEPRA was told that in September, demand for LNG was 950 MMCFD while only 800 MMCFD was supplied.

They said that the power division has presented four months demand of LNG for power production till January, 2022, and also conveyed furnace oil demand till February 2022 for power generation. They said electricity demand increased by seven per cent in September, 2021.

NEPRA vice chairman said that problems related to RLNG are persisting since the last eight to ten months while absence of in time planning regarding the fuel availability has added to the issue.

Speaking on the occasion, officials of the power division said that there were issues with the supply while problems related to the supply of re-gasified LNG will persist until the new LNG terminal starts operation.

“It means that the power consumers will have to pay capacity charges till the availability of new LNG terminals to meet RLNG demand for the power sector,” said vice chairman NEPRA.

NEPRA Chairman Tauseef H. Farooqi was also unhappy over the CPPA not submitting fuel demand in time and asked why the agency does not present LNG demand to concerned LNG buyers.

According to the data submitted by CPPA, CPPA-G said that the total energy generated during September was calculated at 14,031.89 gigawatt-hours (GWh) at a cost of Rs95.361 billion. Power production with hydel sources stood at 36.2 per cent, coal 17.05pc, high speed diesel 0.02pc, RFO 7.11pc, gas 8.90pc, and RLNG 18.90pc.

Power generation from different sources (mixed) came in at 16.18 GWh at a price of Rs4.6382 per unit, while wind power generation was recorded at 230.40 GWh, or 1.64pc, and solar power generation was calculated at 60.75 GWh, or 0.43pc

NEPRA has reserved its judgement, which it will announce later.

 

 

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Ahmad Ahmadani
The author is a an investigative journalist at Profit. He can be reached at [email protected]

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