ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Wednesday notified an additional fuel cost adjustment (FCA) of Rs2.84 per unit for electricity consumed in March, to extract about Rs23 billion from consumers of ex-Wapda distribution companies (Discos) during the current month.
According to an order issued by the regulator, Nepra “has reviewed and assessed a National Average Uniform increase of Rs2.8372/kWh in the applicable tariff for XWDISCOs on account of variations in the fuel charges for the month of March 2024”.
The net increase in tariff due to the FCA impact would be about Rs5 per unit because of its partial spill over to the quarterly tariff adjustment (QTA) to follow later.
The “adjustment of Rs2.8372/kWh shall be applicable to all consumer categories except electric vehicle charging stations (EVCs) and lifeline consumers. The said adjustment shall be shown separately in the consumers’ bills” based on units billed in March 2024, and it will reflect in the billing month of May 2024, Nepra’s notification stated.
In its determination, the regulator also busted a myth advanced by certain vested groups about the negative impact of solar net metering on overall national consumer tariff. Nepra said that the Central Power Purchasing Agency (CPPA) reported about 7.5pc reduction in consumption during the first nine months of the current fiscal year. The CPPA also conceded that only 54.7 gigawatt hour (GWh) of energy came from the solar net metering, accounting for just 0.7pc of total grid pool of 7,756 GWh delivered to Discos.
This also suggests that the narrative against homeowners with solar net metering was being pushed to conceal certain other efficiency-related matters in the power network. Upon inquiry by Nepra, the chief executive of CPPA reported that on an accumulative basis, the actual generation remained lower by 7.4pc for FY2023-24, up to March 2024.
On further inquiry by Nepra about the reason for running RLNG plants, the CPPA responded that “the reason was due to the orders which were already placed for RLNG due to the expected increase in demand and to ensure system stability”.
Upon more questions by the regulator, CPPA submitted that overall consumption reduced by 7.5pc, including a reduction in residential consumption by 11.3pc, commercial by 2.8pc, industrial by 4.5pc, and bulk by 34.5pc. Regarding the reduction in part-load charges, CPPA-G submitted that a proper study needs to be carried out in this regard.
On the issue of low utilisation of Thai coal power plants, CPPA conceded that the overall utilisation of these plants remained around 48pc during March 2024, considering system stability and demand patterns. Regarding the curtailment of Thar-based plants during the month, NTDC responded that this was due to a lack of demand and load management.
It was further revealed that the limitation of the HVDC (Matiari-Lahore) corridor, coupled with system stability issues, led to lower dispatch of certain plants. Regarding the financial impact of operating Guddu 747 on open cycle, CPPA-G stated that the rate difference between open cycle and combined cycle fuel cost component was around Rs3.6/kWh, resulting in an additional cost of Rs580 million.
Upon inquiry regarding the non-utilisation of the Lucky coal power plant despite being higher on the economic merit order, and the operation of the Sahiwal coal power plant which is substantially costlier, CPPA explained that the grid code also mandates the system operator to maintain system stability and reliability while dispatching power plants.
Published in Dawn, May 9th, 2024
