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Rs1.34 per unit raise in power tariff approved

May 01, 2013

ISLAMABAD, April 30: The National Electric Power Regulatory Authority (Nepra) approved on Tuesday an increase of Rs1.34 per unit in electricity tariff and directed the National Transmission and Dispatch Company to decrease supply to the Karachi Electric Supply Company (KESC) to below 300MW.

Presided over by its vice chairman Khawaja Mohammad Naeem, Nepra’s public hearing at the request of the Central Power Purchasing Agency (CPPA) on behalf of power distribution companies decided that the price increase would not apply to domestic consumers of less than 50 units per month and the consumers of the KESC for their March bills.

The CPPA informed the regulator that there was no power generation by coal-based plants in March and during the month gas supply for power generation was also low which had forced the generation companies to rely on expensive high speed diesel and furnace oil.

Nepra noted that about Rs165 million worth of electricity generation was lost due to system losses and overall cost of generation during March amounted to about Rs55 billion.

Mr Naeem and Nepra’s member from Sindh Habibullah Khilji expressed concern over continued supply of 650MW or above to the KESC from national grid despite a decision made by the Council of Common Interests (CCI) to withdraw supply of 350MW to the company and divert it to combined power system of the rest of the country. Mr Naeem said the continued supply of 650MW to the KESC was adversely affecting the supply system in the country, particularly its southern and northern parts.

He said the CCI had taken a unanimous decision to stop supply of 350MW to the KESC and later Nepra had decided that the company would not get 650MW. In any case, he added, the supply to the KESC should not exceed 350MW.

But a representative of the CPPA said the Sindh High Court had issued a stay order against implementation of the CCI decision.

Mr Naeem said the stakeholders, including Nepra, respected court orders but the regulator had not received any restraining order in writing.

He asked the Ministry of Water and Power and the power companies concerned to carefully examine if the court had actually issued such an order.

He urged the ministry and the companies to see whether the CCI decision could be immediately implemented and, if it was not possible, file an intra-court appeal for vacation of the stay order and evolve a mechanism to decrease supply to Karachi in the intervening period because the regulator could not allow existing arrangement for an indefinite period.

He asked the CPPA to at least evolve a mechanism that could be immediately implemented when the confusion over the SHC order was removed. This was important because the KESC had been receiving even 840MW from the national grid while the rest of the country suffered widespread loadshedding, he added.

A senior representative of the CPPA conceded that even if full supplies of furnace oil and gas to power plants were ensured, it would not help to eradicate loadshedding. He said the country’s power generation capacity currently stood at about 17,700MW whereas maximum generation hovered at 9,000MW.

He said about an additional amount of Rs4b would be required per day to confine loadshedding to three hours a day across the country.