The government has decided to pass on the impact of negative Fuel Charges Adjustment (FCA) to domestic electricity consumers and agricultural consumers using up to 300 units per month.
The Power Division has requested the National Electric Power Regulatory Authority (Nepra) to reconsider the long-standing policy that previously barred these categories from receiving the benefit of negative FCA.
According to a news report, the Economic Coordination Committee (ECC) of the Cabinet issued policy guidelines in 2015, stipulating that negative FCA adjustments should not be passed on to domestic consumers with subsidised electricity tariffs.
Subsequently, Nepra ruled in June 2015 that negative FCA would not apply to non-time-of-use (TOU) domestic consumers using up to 300 units. A similar restriction for agricultural consumers had already been in effect since November 2010.
In 2021, the Ministry of Energy introduced new policy guidelines for power subsidy targeting, leading Nepra to create separate consumer categories for protected and non-protected domestic users.
Over time, tariffs for non-protected consumers have increased as part of the government’s policy shift. Given these tariff adjustments, the continuation of the previous FCA policy was deemed inconsistent with the broader objective of subsidy reallocation.
The Power Division has now formally approached Nepra to allow negative FCA to be passed on to non-protected domestic and agricultural consumers, ensuring they benefit from fluctuations in fuel costs and aligning electricity tariffs with evolving government policies.
Power Division spokesperson said that a letter has been written to the National Electric Power Regulatory Authority, requesting the reinstatement of these adjustments.
He added that by waiving these charges for low-usage consumers and agricultural tube-wells, the government aims to ease the financial burden on farmers and households with limited electricity consumption. According to the Power Division, this step will further reduce monthly electricity bills for both agricultural tube wells and 300-unit consumers.
