ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has, in a fact-finding report on repeated power breakdowns in Karachi, held the Karachi Electric (K-Electric) responsible for different deficiencies and violations.

The over 120-page report submitted to the government was prepared by a four-member Nepra commission last weekend but the five-member authority, headed by Tariq Sadozai, discussed its pros and cons and considered additions and deletions for three days.

A Nepra spokesperson had said on Sunday that after finalisation, the report would be made public on Tuesday. But the Nepra meeting decided against it reportedly at the request of the KE which said that it would lead to a pre-mature media trial of the company. Therefore, Nepra forwarded the report to the cabinet division for presentation to the prime minister.

A Nepra official said on Wednesday that the commission had noticed KE’s failure to improve its transmission and distribution system although it appreciated an improvement in its generation system.

Sources in Nepra said the fact-finding team was of the view that KE could not sustain its efforts to utilise its generation capacity because it had not invested proportionately in the obsolete distribution and transmission network.

The report noted that the KE was carrying out much longer loadshedding than it acknowledged in its public statements.

Show-cause notice may be issued to the utility

Sources said that without waiting for government’s action, the authority will issue a show-cause notice to the company under section 28 of the Nepra Act over its failure to meet service standards.

Under the said section, Nepra has the powers to impose a fine of up to Rs100 million or appoint an administrator for the company’s takeover after receiving its response and giving it sufficient opportunity to defend itself.

The sources said the fact-finding team had also held the federal government partly responsible for the power crisis in Karachi and KE affairs because it had 25 per cent shareholding in the company and two directors on its board of directors. The team said that the directors did not do what was expected of them.

The sources said the team had found faults with the supervisory and regulatory role of Nepra, particularly in relation to service standards and fuel efficiency benchmarks. But this part is reported to have been deleted from the report because it could have raised question about Nepra’s silence over the years and would have led to the issue of its past tariff determinations.

The fact-finding committee was set up at the request of the ministry of water and power to ascertain causes of frequent power failure in Karachi. It comprised Nepra’s consultants Masood Ahmad Khan and Javed Pervaiz, senior adviser (technical) Hussain Zaigham Alvi and director (standards) Mazhar Ranjha.

Tariff increase notified Meanwhile, the ministry notified on Wednesday an increase in electricity tariff for Karachi’s domestic consumers by 20 to 70 per cent for different slabs. The increase was approved early this month by Nepra.

According to the notification, the previous slab benefit for higher consumption has been withdrawn, leading to an increase of Rs2 to Rs4.28 per unit for different domestic categories.

After the incorporation of subsidy, tariff for consumers using 201 to 300 units per month has been increased by Rs2.09 per unit to Rs10.20 from Rs8.11. The tariff for consumers using 300 to 700 units has been increased by Rs3.67 per unit to Rs16 from Rs12.33 and for consumers using more than 700 units by Rs2.10 per unit to Rs18 from Rs15.07.

Similarly, peak and off-peak rates for high-end consumers using time-of-use meters have been increased by Rs4 and Rs4.28 per unit, respectively. The peak tariff has been raised to Rs18 from Rs13.99 per unit and off-peak to Rs12.50 from Rs8.22.

Tariff for commercial and industrial consumers will remain unchanged.

The notification passes on to consumers the benefit of 42 paisa per unit reduction in tariff as part of KE profit under its clawback mechanism for the period between Oct-Dec 2013 and Jan-March 2014.

Published in Dawn ,July 16th, 2015

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