The National Electric Power Regulatory Authority (Nepra) has imposed a daily fine of Rs100,000 on the Hyderabad Electric Supply Company (HESCO) for continuing load shedding based on Aggregate Technical and Commercial (AT&C) losses, a practice not recognized under existing legal frameworks.
Nepra’s decision follows a series of public complaints about unscheduled load shedding during hearings on monthly Fuel Price Adjustments (FPAs) for Distribution Companies (DISCOs) and K-Electric.
Upon investigation, it was found that HESCO was carrying out load shedding in line with an AT&C policy, which does not align with the NEPRA Act of 1997 and the Performance Standards (Distribution) Rules of 2005. This policy was never recognized by Nepra.
The authority also noted that HESCO had violated its own AT&C policy by carrying out excessive load shedding compared to the scheduled load shedding.
Additionally, the company had failed to improve the technical and financial health of certain feeders, despite receiving significant funds for operational and maintenance (O&M) costs under Nepra’s supervision. This failure has resulted in hardship for consumers, including those paying their bills promptly.
In response, Nepra initiated legal proceedings, and on April 3, 2024, imposed a fine of Rs50 million on HESCO under the NEPRA Act for violating the Performance Standards. Despite HESCO’s submission of a response to the fine, Nepra rejected the explanation and reaffirmed that the company’s actions were in contravention of the regulatory framework.
The authority has directed HESCO to cease its AT&C-based load shedding immediately and imposed a fine of Rs100,000 per day for each day the company persists in this practice, starting from April 4, 2024, until the issue is resolved to Nepra’s satisfaction. The fine is imposed in accordance with the NEPRA Act and the NEPRA (Fine) Regulations, 2021.
