Karachiites to pay extra Rs1.35bn for power used in July

Published October 27, 2021
A technician from K-Electric fixes new electricity meters at a residential building in Karachi. — AFP/File
A technician from K-Electric fixes new electricity meters at a residential building in Karachi. — AFP/File

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Tuesday notified 69 paisa per unit additional charge to consumers of K-Electric on account of monthly fuel price adjustment (FCA) for electricity consumed in July.

In a notification released on Tuesday, the regulator said about 69 paisa per unit additional FCA would be charged to consumers in the coming billing month of November and generate Rs1.355bn in additional revenue to the KE. “The FCAs shall be applicable to all the consumer categories except lifeline consumers,” Nepra said.

Under the tariff mechanism for KE, impact of change in KE’s own generation fuel cost component due to variation in fuel prices, generation mix and volume is passed on to the consumers directly in their monthly bills in the form of FCA. Similarly, impact of change in the fuel component of Power Purchase Price (PPP) due to variation in fuel prices and energy mix are passed on to the consumers through monthly FCA.

However, the impact of monthly variations in KE’s own generation’s fuel cost component as well power purchase price to the extent of targeted transmission and despatch losses, not taken into account in the monthly FCAs are adjusted on quarterly basis.

The regulator said the power purchase agreement was signed between National Transmission & Despatch Company (NTDC) and KE in January 2010 for five years for sale/purchase of 650MW on basket rates. Subsequently, a decision was made by the Council of Common Interests (CCI) in November 2012 for withdrawal of electric power from NTDC by the KE from 650MW to 350MW which was blocked by KE suits/petitions in Sindh High Court.

It said no new agreement had been signed between KE and NTDC till date as the Karachi-based power utility continued to draw energy from the national grid which later increased and now stands at around 1,100MW.

The regulator pointed out that two plants — KGTPS and SGTPS — were not operated by KE to their full capacities, and also less energy was drawn from national grid consecutively for number of days. Similarly, another plant — KCCPP — was operated on high-speed diesel. The regulator also took serious notice of non-signing of GSA between KE with SSGC, and noted that consumers should not bear inefficiencies and challenges on the part of KE.

The KE, however, reported that the STGPS and KGPTS were at tail-end, resulting in low gas pressure as SSGC’s infrastructure was depleted and required rehabilitation. It said SSGC had been asked time and again to make the required investments to improve the gas pressure issue and remove other technical issues.

The KE also reported that it had offered SSGC to provide a dedicated infrastructure at the cost of KE but because of being within the city and Right of Way issues, fully dedicated infrastructure was not possible.

Published in Dawn, October 27th, 2021

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