ISLAMABAD: The distribution companies of formerly Wapda on Thursday sought Rs2.76 per unit reduction in consumer tariff for a month as the power regulator approved increase in the electricity rates for consumers of K-Electric (KE).

After a brief public hearing, the National Electric Power Regulatory Authority (Nepra) allowed a 15-paisa per unit increase in KE’s fuel based tariff under monthly fuel price adjustment for the month of July 2016 and another 23-paisa per unit increase for the month of August.

The increase in tariff would be charged to consumers in the billing month of November and December respectively.

The KE representatives told Nepra that the increase was necessitated by higher fuel cost of power generation both from KE’s own plants and purchases from other sources.

It was reported that KE sold more than 1.63 billion electricity units in July and 1.58bn units in August. The higher power rates would not be applicable to lifeline consumers using less than 50 units per month.

Nepra also fixed October 27 for hearing a request by the Central Power Purchasing Agency (CPPA) to reduce fuel charges for the consumers of all the distribution companies (except KE) by Rs2.76 per unit. The request is based on actual fuel cost of power generation in the month September.

Under the practice in vogue, the distribution companies are charging an estimated fuel charge to power consumers that is adjusted against actual cost in a subsequent month with the approval of the power regulator.

The CPPA claimed it sold about 10.034bn electricity units to consumers in September 2016 with a total cost of Rs36.85bn. It said the power companies had charged reference fuel charges of Rs6.43 per unit to consumers while the actual fuel cost came out at Rs3.67 per unit. Therefore, a refund of Rs2.76 was required to be passed on to the consumers.

The CPPA reported that furnace oil based power generation cost stood at Rs7.6 per unit compared to gas based average costs of Rs5.24 per unit. The fuel cost of diesel based plants was reported at Rs12.33 per unit, no fuel cost for hydropower plants and Rs1.16 per unit of nuclear plants. The fuel cost of electricity imported from Iran stood at Rs10.6 per unit.

It said the hydropower generation contributed the biggest share of about 41.2 per cent while furnace oil based plants generated about 26pc energy. Gas-based plants generated 22pc electricity for the national grid followed by 4pc of Nuclear and 1pc by diesel plants.

The reduced rates would not be applicable to all agricultural and domestic consumers using less than 300 units per month under a decision of the PML-N government that this was already a subsidised segment of population.

Published in Dawn, October 21st, 2016