ISLAMABAD: While still reeling under the prolonged application of last year’s Rs135 billion worth of quarterly adjustments, the ex-Wapda distribution companies (Discos) have come up with a fresh claim of another Rs22.6bn for the first quarter of FY24 to be charged to consumers across the country at the rate of about Rs1.8 per unit.
The requests have come amid over prevailing over 31pc rate of inflation which suggests that official estimates of declining inflationary trends might not be as forthcoming as electricity and gas rates have a major contribution to the price baskets.
In their separate tariff petitions, Discos have pushed to raise about Rs22.6bn from their consumers in three coming months under quarterly tariff adjustment (QTA) for the July-September period.
The National Electric Power Regulatory Authority (Nepra) has accepted the respective tariff petitions and called public hearings on Nov 14 to see if the proposed increase in tariff is justified in line with the quarterly tariff adjustment mechanism. The quarterly adjustments for Discos are now automatically applicable to KE’s consumers as well as per recent decisions of the government and the regulator.
Regulator fixes public hearings for Nov 14
The increase has been sought by Discos to finance the additional financial impact of capacity charges arising out of currency devaluation and interest rate hikes besides the market operator fee, the impact of transmission and distribution losses on fuel cost adjustments, the cost of incremental consumption and variable operation and maintenance charges for the first quarter of the current fiscal year.
At present the consumers are paying about Rs3.28 per unit QTA for the fourth quarter of the last fiscal year that would remain applicable for six months — October to March 2024 — to mop up more than Rs200bn across the country including K-Electric. This was to be charged at Rs5.40 per unit for three months as per the routine mechanism but was spread over six months to reduce sudden price shock on consumers.
Under the petitions, the Disco from Lahore has demanded the highest claim of Rs10.3bn, followed by Rs5.54bn by Islamabad, and Rs4.2bn by Faisalabad — the three discos officially considered as the best performers among the 10 Discos. Another Rs2.1bn claim has been filed by Peshawar, followed by Rs1.2bn by Tribal Disco and then Rs1.06bn by Hyderabad-based Disco.
Sukker and Gujranwala-based companies have demanded Rs926 million and Rs396 million additional funds, respectively while Quetta and Multan-based firms have suggested a negative adjustment of Rs2.6bn and Rs520 million respectively.
On approval, the adjustment would recovered on a uniform basis from all consumers except for lifeline.
Published in Dawn, October 31st, 2023
