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| July 6, 2005 | Wednesday | Jumadi-ul-Awwal 28, 1426 |
43-52 pc power tariff hike sought
ISLAMABAD, July 5: The Lahore and Gujrawanala electric supply companies on Tuesday sought an increase in tariff by 43 to 52 per cent for below-poverty-line consumers and 14 to 20 per cent for other power users. However, the National Electric Power Regulatory Authority (Nepra) observed that all distribution companies of Wapda were already charging much higher and arbitrary rates and apparently there was no reason for any further increase.
The two companies demanded a three-year tariff and about 43-52 per cent increase in power rates for consumers using up to 50 units per month.
The chief executives of the two companies presented their case for tariff increase and a multi-year tariff based on 10 per cent projected inflation at a public hearing arranged by the Nepra.
“The power companies are charging much more than they prudently deserve and consumers are paying much more than they should,” said Lt-Gen Saeed-uz-Zafar, chairman of Nepra.
He said the billing made by Wapda and NTDC (National Transmission and Dispatch Company) had no justification because the power purchase price approved by the Nepra and notified by the government last year was significantly on the lower side.
He said non-issuance of notification regarding tariffs of distribution companies by the government was also yielding windfalls to the tune of about 50 paisa per unit on an average and a lot of saving was accruing due to maximum hydel-power generation this year.
He told reporters that Nepra had asked the government to remove a loophole in the Nepra Act because it was silent on the legal status of a tariff determined by it if the same was not notified within 15 days.
He said the government, instead of notifying earlier tariffs, had asked the distribution companies to file new petitions seeking raise in tariff at least for three years.
He said Nepra would verify from the finance ministry and the State Bank of Pakistan if 10 per cent inflation being claimed by the companies was correct because public statements of the prime minister and finance ministry officials contradicted such assumptions.
A Nepra officer said the distribution companies were trying to capitalize on peak inflation rate during the next three years because the federal government’s projections for inflation showed a declining trend from eight per cent to five per cent over the next three years.
Mr Zafar said he was of that view that due to minimum furnace oil consumption and maximum hydel power generation in the last few months, there was no reason for tariff increase. But a final determination would be based on a thorough examination and analysis of facts and figures, he said adding that the companies had not mentioned any tangible expenditure which should warrant an increase in the tariff.
The chairman and members of Nepra took strong exception to the fact that Wapda and NTDC were charging much higher power price from the distribution companies than already approved by Nepra and notified by the government in the gazette of last year.
They said charging of high transmission and power generation rates from these companies, and ultimately from consumers, was unfair, arbitrary and without any legal standing.
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