ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) reduced on Tuesday electricity tariff by Rs1.81 per unit for all distribution companies and Rs1.16 for K-Electric for one month in view of cheaper generation of power in October.
According to Nepra, the distribution companies collected about Rs21 billion additional charges in October because of pre-determined higher reference tariff which is now required to be refunded to consumers.
The reduced tariff will be readjusted in the billing month of February next year.
Also read: Nepra to promote power generation by consumers
The lower tariff will not apply to domestic consumers using less than 300 units a month and agriculture consumers under a government decision that they are already in categories enjoying subsidies.
The decision to reduce tariff was taken at the request of the Central Power Purchase Agency (CPPA) at a public hearing presided over by Nepra Vice-Chairman retired captain Haroon-ur-Rashid.
It was informed during the hearing that better gas availability and low-priced generation through furnace oil because of its lower prices had contributed to a reduction in tariff. Hydropower generation in October stood at about 30 per cent which had no fuel cost at all. The largest contribution of 32.8pc came from natural gas-based plants and its fuel cost was worked out at Rs6.06 per unit.
This was comparatively high cost because of LNG factor against gas-based power generation whose fuel cost stood at Rs5.5 per unit in September. It was followed by 31pc generation from furnace oil-based plants with a fuel cost of Rs7.26 per unit and about 2.08pc from diesel-based plants with a generation cost of Rs12.31 per unit. Nuclear power plants contributed 2.73pc electricity to the national grid with a fuel cost of Rs1.125 per unit.
The CPPA representatives explained that the regulator had set a reference fuel price of Rs7.33 per unit for October, but the actual cost stood at Rs5.52 because of a reduction in oil prices, requiring a Rs1.81 per unit cut in tariff.
The fuel charges of all distribution companies are subject to adjustments on the basis of information provided by the CPPA about the actual charges for every month.
The CPPA said it had received 8,107 gigawatt hours from different sources in October.
Published in Dawn, December 2nd, 2015
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