PESHAWAR, Sept 8: The Peshawar High Court was informed on Tuesday that an agreement had reached between the Khyber Pakhtunkhwa and federal governments over the controversy of fixation of power tariff by the National Electric Power Regulatory Authority (Nepra) following which the tariff on the distribution of electricity in the province would be equal to that of other provinces.

Advocate Shumail Butt, representing the provincial government, informed a two-member bench that in the light of the said agreement the new tariff rate would be applicable to the consumers in the province with prospective effect and not with retrospective effect and thus arrears of over two years amounting to Rs15 billion would not be recovered from the consumers.

The bench comprising Chief Justice Ejaz Afzal Khan and Justice Mazhar Alam Miankhel was hearing a writ petition filed by the Khyber Pakhtunkhwa government challenging the raises in power tariff by the Nepra on the electricity distributed in the province through the Peshawar Electric Supply Company (Pesco).

Mr Butt said that in the light of this development the present writ petition would be withdrawn after approval by the chief minister. The agreement would benefit around 2.4 million power consumers in the province.

The petitioner contended that as compared to other parts of the country the Nepra had ordered much higher increases for the consumers of Pesco in the province.

The provincial government claimed that since March 1, 2008, Nepra had on several occasions ordered much higher raise in tariff rates whereas on regular basis it made auto tariff adjustment. It was added that the accumulative increase in tariff rates amounted to around 60 to 70 per cent.

Mr Butt said that recently in a high level meeting between the two governments, which was headed by the prime minister, an agreement had taken place in the light of which the two main demands of the provincial government were accepted.

He said that the main demand of the provincial government was that the consumers in the province should not be subjected to differential tariff and the power tariff in the province should be similar to that in the other provinces.

Moreover, he added that another major concern of the province was the date of applicability of the new tariff as since 2008 the recovery of the controversial tariff had been stayed by the court. He added that in past the federal government had hinted that arrears to the tune of Rs15 billion would be recovered from the consumers, but now they had agreed that the new tariff would be applicable on prospective basis.

The president of the Supreme Court Bar Association, Qazi Mohammad Anwer, appeared for the Nepra, the deputy attorney general Mohammad Iqbal Mohmand appeared for the federal government whereas the Pesco and Pepco were represented by Qazi Mohammad Jamil and Anwer Kamal.

The respondents in the petition are: Nepra, Pesco, Pepco, Ministry of Water and Power and Cabinet Division.

The Nepra and Pesco had earlier in their comments claimed that the present writ petition was not maintainable and was liable to be dismissed.

The Nepra in its comments had claimed that the plea taken by the provincial government that under Article 157 of the Constitution the provincial government was empowered to determine the tariff for distribution of electricity within the province had already been decided by the Supreme Court in different cases.

Earlier, the NWFP government had filed identical petition in the erstwhile Islamabad High Court. However, after the abolition of the said high court in the wake of a judgment of the Supreme Court it was transferred to the Rawalpindi Bench of the Lahore High Court.

The LHC had disposed of the petition in Nov 2009 following which the present petition was filed in the PHC.

Before the filing of this petition the Pesco had issued electricity bills to its consumers which also included arrears that Pesco claimed it would recover in 15 installments from the private consumers.

However, after the court issued a stay order on Dec 23, 2009, the company had to issue revised bills to the consumers. The said stay order has been in the field till date.