ISLAMABAD: The Water and Power Development Authority (Wapda) has sought an increase of 120 per cent in its tariff for hydel power from less than Rs6 per unit at present to Rs13 from July 1 this year.
The unusually high tariff increase has been sought mainly because of induction of a small power plant — 72MW Khan Khwar Hydropower Project (KKHP) — into the system but this would have its effect on the overall cost of about 6,500MW hydropower generation by Wapda.
In its tariff petition filed before the National Electric Power Regulatory Authority (Nepra), Wapda had solicited an increase of Rs7.10 per unit in variable energy cost from existing Rs5.90 per unit to Rs13 per unit.
It has sought a raise in fixed charges from Rs414 per kilowatt per month to Rs939 per kilowatt per month, up by 127 per cent.
Wapda Hydroelectric is currently operating 13 hydropower stations having installed capacity of 6,444MW. With the commissioning of 72MW KKHP in December 2010, the installed capacity has increased to 6,516MW.
On the basis of audited financial accounts for financial year 2009-10 and projected change in revenue requirement for fiscal year 2011-12, the regulator asset base of Wapda has increased from Rs143 billion to Rs214 billion due to additional capital investments on the ongoing projects.
The Wapda’s operation and maintenance cost has also increased from Rs4 billion to Rs10.63 billion, up by 166 per cent, because of repeated increases in pay and allowances and higher maintenance costs.
In addition, the overall weighted average cost of capital has also increased from 13.7 per cent to 15.1 per cent owing to increase in the cost of debt.
On top of that, the depreciation cost of operating assets also increased from Rs5.4 billion to Rs6.9 billion due to addition in operating assets. The water use charges of Wapda have also increased slightly form Rs720 million in 2009-10 to Rs836 million on account of higher generation at Mangla power station.
On the other hand, income from other activities like fisheries and boating etc has dropped from Rs2.1 billion two years ago to Rs825 million.
Wapda said that its revenue gap stood at about Rs12 billion in 2009-10 and Rs12.35 billion in 2010-11 whose determination and notification was delayed.
The proposed tariff increase has been estimated on the basis of net electricity output of 30,783 Gwh that accounts for about one-fourth of the entire annual power output, including generation from all other sources.
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