ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) approved on Thursday a reduction of Rs2.68 per unit in electricity rates of all distribution companies, except K-Electric, on account of monthly fuel price adjustment — which will be applicable from July 1.

The decision was taken after a decline in prices of petroleum products in the international market.

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Nepra had earlier received an application for fuel adjustment charges from the Central Power Purchase Agency (CPPA) in this regard.

This reduction in power tariff would not be applicable on consumers using less than 300 units every month.

The fuel charges of all distribution companies are subject to adjustment on the basis of information provided by the CPPA about actual fuel charges for each month.

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Under the automatic fuel adjustment formula Nepra is required to determine the difference of fuel cost every month and directly pass it on to consumers.

The fuel charges of all distribution companies are subject to adjustment on the basis of information provided by the CPPA about actual fuel charges for each month.

Last year, the government had asked Nepra to allow 18pc system losses, instead of 13.5pc, in consumer tariff, having a financial impact of about Rs30bn a year. But the regulator declined to oblige, saying it could not overturn its own determinations made after a proper process of public hearings unless any fresh information or data was brought up for consideration. One per cent system losses work out to about Rs6bn.

Nepra said its own rules and laws as well as the Supreme Court’s decisions did not allow passing on to consumers the imprudent costs of electricity caused by continuous failure of the power companies and the government to overcome inefficiencies.