ISLAMABAD: A petition seeking more than 80 per cent increase in the bulk generation tariff of the Water and Power Development Authority (Wapda) came under scrutiny at a public hearing held by the National Electric Power Regulatory Authority (Nepra) on Thursday.

The hearing, presided over by Nepra’s member for Khyber Pakhtunkhwa Maqsood Anwar Khan, was informed by a Wapda team that its base revenue requirement for the current fiscal year (FY26) stood at Rs179 billion, up from Rs96.93bn approved by Nepra for FY23. This translates into an increase in the base annual tariff from Rs3.10 per unit to Rs5.67 — an increase of more than 83pc.

However, pending claims of regulatory revenue gaps for the past three years raised Wapda’s revenue requirement for FY26 to Rs318.5bn, compared to Rs119.96bn in FY23.

Additional payables on account of net hydel profit to provinces and Azad Kashmir pushed the final revenue requirement for the current year to Rs365bn for a projected generation of 31,563 gigawatt hours (GWh), against Rs191bn in FY23 for 31,286GWh. This works out to an estimated 90pc increase in the bulk hydropower rate to about Rs11.55 per kilowatt hour (kWh), up from Rs6.10 per unit.

Nepra’s member (technical) from Sindh Rafique Shaikh questioned Wapda’s performance on completed hydropower projects. “Name a single project that has met its generation targets,” he asked.

Wapda officials responded that their performance should not be assessed on a project-to-project basis like independent power producers. Instead, they argued, Wapda’s overall contribution should be evaluated in terms of water and food security, flood protection, and total generation output, which is subject to natural factors such as hydrology and irrigation requirements.

Rafique Shaikh countered that Wapda did not want project-level scrutiny, but such an argument would only be justified if the authority were seeking a tariff reduction instead of an increase.

Wapda’s petition for Rs365bn in revenue requirement for the current fiscal year includes Rs99bn for debt servicing on loans for ongoing projects and more than Rs15bn to cover a proposed 100pc increase in employee salaries over three years, up from the current Rs7.41bn. It was also reported that some projects remain offline due to security concerns.

The additional Rs174bn sought for FY26 includes unaddressed financial gaps of Rs22.35bn for FY23, Rs56bn for FY24, and Rs61bn for FY25. The revenue requirement also factors in Rs29.5bn in net hydel profit for Khyber Pakhtunkhwa at a rate of Rs1.55 per unit, Rs11.7bn for Punjab at Rs1.47 per unit, and Rs5bn in water use charges for AJK at Rs1.10 per unit.

Wapda has also sought an 85pc increase in return on investments and operations & maintenance (O&M) costs, projecting Rs179bn in FY26 compared to Rs97bn determined for FY23. This includes raising O&M expenses from Rs24bn in FY23 to Rs30.665bn in FY24, Rs36.374bn in FY25, and Rs39.59bn in FY26 — an increase of 67pc.

Published in Dawn, September 12th, 2025