ISLAMABAD: K-Electric has sought to refund about Rs10.26 per unit charged to its consumers under monthly fuel charges during December 2022 involving a negative financial adjustment of about Rs12.1 billion in KE’s accounts.

The National Electric Power Regulatory Authority (Nepra) has accepted the KE’s tariff petition under the monthly fuel cost adjustment (FCA) mechanism and has fixed Jan 30 for a public hearing.

The regulator would now examine the petition on two counts — whether the Karachi-based power utility’s refund estimate was justified or required a higher refund to consumers and whether the company had followed economic merit order while utilising its own and external power purchases.

The FCA for KE has now dropped to the negative zone for a few months because of a more than Rs7 per unit increase in nationwide uniform base tariff from July 1, 2022 and higher quarterly tariff adjustments since then.

This is the sixth month in a row that FCA for KE’s consumers is lower than the reference tariff. This partly reduced the burden of record-breaking increase in FCAs that went beyond Rs11 per unit during the last fiscal year ending June 30, 2022.

After approval by the Nepra, the cut in FCAs would be adjusted in consumers’ bills in the upcoming billing month of February. The FCA is reviewed every month as per the tariff regime applicable across the country and is usually applied to the consumer’s bills for one month only.

Earlier this month, Nepra had allowed Rs7.43 cut in FCA for power consumed in November against KE’s request for Rs7.21 per unit cut. Under that decision, the KE is required to refund about Rs10bn to consumers during the current billing month (January).

Published in Dawn, January 19th, 2023