Nepra reserves judgement on Rs1.26 per unit increase for KE

Published September 3, 2021
The KE representatives told the public hearing that increase in the cost of furnace oil and liquefied natural gas had an additional cost of Rs2.4bn during July. — APP/File
The KE representatives told the public hearing that increase in the cost of furnace oil and liquefied natural gas had an additional cost of Rs2.4bn during July. — APP/File

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Thursday reserved its judgement about Rs1.26 per unit additional charge to consumers on account of monthly fuel price adjustment and quarterly adjustment for April-June 2021.

At a public hearing presided over by Nepra chairman Tauseef H Farooqui, the regulator took up two separate petitions of K-Electric (KE) for additional charge to consumers including 55 paisa per unit on account of fuel cost adjustment (FCA) for July and 71 paisa per unit for quarterly adjustment for April-July 2021.

The KE representatives told the public hearing that increase in the cost of furnace oil and liquefied natural gas had an additional cost of Rs2.4bn during July. However, Nepra case officers pointed out that the utility had also violated the economic merit order which alone had an impact of 51 paisa per unit or Rs990 million.

The KE officials did not agree and maintained that in the absence of one unit, its replacement unit had to be utilised.

KCCI assails ‘expensive’ power generation by utility when surplus electricity was available

Expensive fuel had to be utilised to avoid load shedding on the directives of the federal government because load shedding in extreme weather conditions was unacceptable, the utility official added.

On the occasion, Karachi Chamber of Commerce and Industry (KCCI) President Zubair Motiwala said power plants of Tapal, Port Qasim and Gul Ahmad had completed their productive live and yet being used despite their generation cost touching Rs18 per unit. He said it was unfortunate that surplus electricity was available in the national grid but KE was resorting to expensive power generation.

The KCCI team later boycotted the proceedings as Mr Motiwala kept on criticising the regulator and KE.

The Nepra chief called for specific points rather than personal attacks, adding that they (KCCI) could not secure decisions of their choice and it was their choice to leave the forum but personal criticism would not be allowed.

The KE officials said the Sui Southern Gas Company had not been able to improve gas supply network therefore the power utility continues to face low pressure problem. When asked why they are not taking cheap electricity from the national grid, KE representatives said they were ready to buy more electricity from the national grid but no one is ready to provide it the guarantee for uninterrupted power supply.

KE had also filed a request for quarterly adjustments for quarter April-June 2021 in tariff on account of variation in Power Purchase Price (PPP) other than fuel, impact of Transmission & Distribution losses on fuel charges variation and annual adjustment on account of Write offs, adjustment for Transmission & Distribution losses, consumer price index etc as per the mechanism provided in the MYT determination.

For the quarterly increase KE had requested 71 paisa per unit increase in power tariff. KE had requested gross write-off of Rs15.9bn for the FY2021. Nepra has reserved the judgment and will issue notification regarding KE power tariff increase later.

Published in Dawn, September 3rd, 2021

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