Major chunk of adjustments has been sought for payment of Rs8.06b capacity payments for first quarter of FY2024-25.
ISLAMABAD - Ex-Wapda Power Distribution Companies (Discos) have requested the National Electric Power Regulatory Authority (Nepra) to allow them collection of an additional Rs8.71 billion, including Rs8.065 billion additional capacity charges, from the power consumers on account of quarterly tariff adjustments.
A major chunk of the adjustments, by the Discos on the account of quarterly tariff adjustments, has been sought for the payment of Rs8.065 billion capacity payments for the first quarter of FY2024-25. In separate requests submitted with NEPRA, Faisalabad Electric Supply Company (FESCO), Gujranwala Electric Power Company (GEPCO), Islamabad Electric Supply Company (IESCO), Lahore Electric Supply Company (LESCO),Multan Electric Power Company (MEPCO), Peshawar Electric Supply Company (PESCO), Quetta Electric Supply Company (QESCO), Sukkur Electric Supply Company (SEPCO), and Tribal Areas Electricity Supply Company (TESCO), have sought the regulator nod for the transfer of an additional Rs8.71 billion to the consumers on account of quarterly adjustments for first quarter (July to Sept) of 2024-25.
According to details, the proposal from the DISCOs includes various charges aimed at covering operational and maintenance costs. NEPRA documents outline the key areas for which the additional funds are being requested, specifying Rs8.06 billion for capacity charges, which compensate power plants for maintaining availability, even if not actively generating. The highest capacity charges of Rs3.884 billion have been claimed by MEPCO, followed by Rs2.565 billion by GEPCO, Rs1.965 billion by QESCO, Rs1.963 billion by IESCO, Rs1.518 billion by PESCO, and Rs492 million by SEPCO. Three Discos including FESCO, HESCO and LESCO have claimed negative capacity charges on account of QTA. Another Rs 1.25 billion is requested for operations and maintenance costs, essential for managing infrastructure upkeep, ensuring reliability, and maintaining the network. In addition, the proposal includes Rs1.65 billion for system charges and market operations fees (UoSC &MoF). These cover the costs associated with the operation of the grid system and market activities, including administrative and logistical expenses required to keep the power supply chain functional. Together, these costs contribute to the overall financial requirements for maintaining grid stability and supporting the operations of the power distribution companies. Interestingly, the documents also mention a saving of approximately Rs2.25 billion, achieved by minimizing transmission and distribution losses. This saving, resulting from improved efficiency in the power network, represents an effort to counterbalance some of the increased costs and reduce the total burden on consumers.
The NEPRA hearing, scheduled for November 20, will review the distribution companies’ request in detail. If approved, the increase will not only impact customers across the country but also extend to consumers of K-Electric, who will experience a similar adjustment in their bills. This adjustment, if enacted, could affect household budgets nationwide as it directly translates into higher monthly bills for electricity users. Pursuant to the notified tariff, the DISCOs have filed their requests for adjustments on account of capacity charges, transmission charges & market operator fee, impact of incremental units and impact of T&D losses on FCA and variable operation & maintenance charges for the 1st quarter of FY 2024-25 i-e July to Sept 2024, in line with the notified mechanism in this regard. Nepra will conduct public hearing on Discos petition on Nov 20.
