KARACHI: The cost of fuel for electricity generation in February went down 27 per cent to Rs8.94 per unit on a month-on-month basis, according to data recently released by the National Electric Power Regulatory Authority.

The sharp month-on-month decline in the fuel cost was partly because hydel-based generation surged 2.9 times in February, according to Arif Habib Ltd.

However, the fuel cost, which is one of the three components of the final rate that power producers charge their government-backed buyer, went up 89.6 per cent on an annual basis from Rs4.71 per Gigawatt hour in February 2021.

The share of hydel-based electricity production was 18.2pc in February, markedly higher than 5.8pc share in January. In contrast, coal-based cost of generation went down 7pc on a monthly basis to Rs13.09 per kilowatt hour in February.

Imported gas–based cost of generation declined 14pc to Rs14.32 a unit owing to a 2pc monthly dip in the price of imported gas.

Similarly, furnace oil–based cost of generation went down 6pc to Rs21.46 a unit while high-speed diesel, which is the most expensive source of power generation, wasn’t used at all to produce electricity in February. The month-on-month increase in solar-based generation was 25pc, it said.

The largest contributor to the power mix in February was coal with a share of 32pc, followed by hydel (18.2pc), imported gas (15.2pc), nuclear (12.5pc), gas (11pc), furnace oil (7pc), wind (2pc) and wind and bagasse with a share of 1pc each.

Published in Dawn, March 22nd, 2022