ISLAMABAD: The five-member National Electric Power Regulatory Authority (Nepra) and various consumer representatives on Thursday stood unanimous in strongly criticising the government for an unprecedented and continuing hike in electricity prices without addressing the structural problems in the power distribution companies as the regulator appeared set to allow an electricity surcharge of up to Rs3.23 per unit for next fiscal year beginning July 1, 2023.

Nepra had called a public hearing on the fresh request of the Power Division for increasing the surcharge on electricity to Rs3.23 per unit from Rs1.43 per unit approved by the regulator for the next fiscal year early this month on top of Rs3.82 per unit surcharge for four months of the current fiscal year.

Chairman Nepra Tauseef H. Farooqui, who presided over the hearing, and all the other members of the regulator lamented that there appeared to be no end to the sufferings of the people and it was ironic that a fresh request had been filed for increasing the surcharge within days after it was imposed.

It is not Nepra’s job to impose this surcharge, the chairman Nepra said, adding that imposition of power surcharge will not resolve the issue of circular debt any more.

Asks why consumers have to pay for Discos’ inefficiencies

“What is the hurry that you are pushing for next year’s power surcharge so early”, questioned the Nepra chairman and pleaded with the government representatives to “let the people breathe a bit”.

“How far will this matter go?” Member Nepra-Khyber Pakhtunkhwa Maqsood Anwar questioned saying the government could submit more applications to raise more surcharges again.

“Why should the people be punished for the poor performance of power Discos [power companies]”, wondered Member Sindh Rafique A. Shaikh and criticised the power ministry officials for requesting a further increase in power surcharges. He called for resolving the problems of electricity companies.

Member Balochistan Nepra Mathar Niaz Rana also expressed concern over the poor performance of power distribution companies and called for addressing the governance issues within the companies instead of repeatedly burdening the people.

“There is a lot of criticism on us”, he said adding that “what confidence should we give to the customers, when will the situation be fixed”?

Member Punjab Nepra Amina Ahmed asked the power division official not to mislead regarding the imposition of surcharge and wondered why the matter was being referred to the regulator again and again when the federal government had the power to levy a surcharge.

Power Division officials said the circular debt stood at Rs2.6 trillion which included payments to Independent Power Producers (IPPs) and Power Holding Company’s debt.

They said the government was facing problems in paying off dues to Chinese coal-fired power plants and the power division had submitted a plan to the ministry of finance for payment of dues to the IPPs.

Representing the Karachi Chamber of Commerce and Industry Tanveer Bari said that the industrial tariff will reach Rs50 per unit in the given circumstances and the industry would collapse. Mr Bari added that the KCCI strongly rejects the request for an increase in electricity surcharges.

Published in Dawn, March 17th, 2023