KE seeks over Rs5/unit tariff hike for six months

Published July 17, 2021
According to petitions, KE has demanded an additional charge of Rs1.98 per unit for electricity consumed in January, Rs2.495 for February and Rs1.497 for March and 21 paisa for June. — Online/File
According to petitions, KE has demanded an additional charge of Rs1.98 per unit for electricity consumed in January, Rs2.495 for February and Rs1.497 for March and 21 paisa for June. — Online/File

ISLAMABAD: The ex-Wapda distribution companies (Discos) have sought about 80 paisa per unit increase in tariff for one month while K-Electric has demanded up to Rs2.5 per unit increase for six months under monthly fuel cost adjustments (FCAs).

Separately, the Karachi-based power utility has also sought about 37 paisa per unit increase in its normal tariff under quarterly tariff adjustment (QTA) for January-March 2021 period.

The National Electric Power Regulatory Authority (Nepra) had decided to hold public hearing on these petitions on July 28 to examine if data provided by the power companies justified such tariff increases.

According to petitions, KE has demanded an additional charge of Rs1.98 per unit for electricity consumed in January, Rs2.495 for February and Rs1.497 for March and 21 paisa for June. These higher adjustments in tariff would yield about Rs7.62bn to KE.

Discos demand 80-paisa increase for June; regulator calls public hearing on 28th

However, it has sought negative FCA of 87 paisa per unit for April and 65 paisa per unit for May with a revenue loss of Rs2.9bn. As such, the power utility would earn net additional revenue of Rs4.5bn for the entire six month period.

On the other hand, the Central Power Purchasing Agency (CPPA) has demanded an additional charge of about 80 paisa per unit from consumers of Discos on account of higher generation cost of electricity consumed in June to generate over Rs7bn in additional cash flows to power companies. The higher electricity rates, on approval by the regulator, would be recovered from consumers in the upcoming billing month (August).

The CPPA said the Discos had charged consumers a reference fuel tariff of Rs5.934 per unit in June while the actual fuel cost turned out to be Rs6.74 per unit and hence 80 paisa per unit should be allowed to be recovered from consumers’ in next month bill.

The CPPA reported that total energy generation from all sources in June stood at 14,361 gigawatt hours (GWhs) at a cost of Rs81.2bn or Rs5.65 per unit. Of this, about 13,971 GWh were delivered to the Discos at Rs94.16bn, at an average rate of Rs6.74 per unit.

The data showed that hydropower generation contributed 29.4pc to overall energy mix in June against 26.6pc in May. The share of coal generation stood at 18pc against 20pc in May. On the other hand, the generation from furnace oil-based plants increased to 8.2pc against 6pc in May and 2.62pc in April. The share of RLNG-based power generation to national grid stood at 18.8pc in June against 22pc in May while share of local gas based generation dropped to 9pc in June when compared to 11pc in May.

On the other hand, the share of nuclear power slightly increased to 11.27pc in June from 10.2pc a month earlier. The share of wind power and baggase stood at 4pc. There was no fuel cost on hydroelectricity.

The coal-based fuel cost stood at Rs8 per unit. Nuclear energy fuel cost stood Re1 per unit while power produced from local gas stood at Rs8.17 per unit. The cost of RLNG-based plants was worked out at Rs10.6 per unit.

The electricity imported from Iran had a cost of Rs11.37 per unit and its total share in power supply was just 0.35pc. The most expensive generation came at Rs14.52 per unit from furnace oil-based plants and a minor production from diesel at the rate of Rs20 per unit.

Under the tariff mechanism, changes in fuel cost are passed on to consumers only on monthly basis through automatic mechanism while quarterly tariff adjustments on account of variation in power purchase price, capacity charges, variable operation and maintenance costs, use of system charges and including impact of transmission and distribution losses are built in the base tariff by the federal government.

Published in Dawn, July 17th, 2021

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