Nepra approves Rs5.27 per unit hike in power tariff for KE’s consumers

ISLAMABAD – Karachiites will have to pay an additional Rs5.2718/unit in their July bills, on account of monthly fuel charges adjustments (FCA) for April, having an impact of Rs 11.8 billion on the power consumers.
National Electric Power Regulatory Authority Friday notified an increase of Rs 5.2718 per unit in power tariff for K-Electric on account of monthly fuel charges adjustments (FCA) for April 2022.
Initially, the K-Electric had sought a hike of Rs4.86/unit under monthly fuel cost adjustment (FCA) with a revenue estimate of Rs9.353 billion, however later it had upward revised the demand to Rs 5.307/unit, arguing that the increase was on account of higher tariff of national grid and furnace oil cost for its own power generation.
In its decision notified here NEPRA noted that the power purchase agreement was signed between NTDCL and K-Electric on January 26, 2010 for five years for sale/purchase of 650MW on basket rates. Subsequently, a decision was made by the Council of Common Interest (CCI) in its meeting held on November 08, 2012 with respect to the modalities for withdrawal of electric power from NTDCL by the petitioner, wherein it was decided to reduce the supply of energy by 300MW from NTDCL to K-Electric. However, the aforementioned decision of the CCI has been impugned by way of suits/petitions by K-Electric in the High Court of Sindh at Karachi. No new agreement has been signed between K-Electric and NTDCL till date, and K-Electric is continuing to draw energy from the National Grid, which at present is around 1100MW.
K-Electric had requested an amount of Rs.2.323b for operation of KCCPP on HSD during April 2022. The Authority for the purpose of instant adjustment has provisionally considered the same amount i.e. Rs.2,323 million.
The Authority observed that K-Electric has been directed to provide CV test reports for both Tapal and Gul Ahmed. For the purpose of current month FCA, the supplier’s CVs have been considered for adjustment of Tapal. This has resulted in provisional negative adjustment of Rs.4.32 million for Tapal.
Regarding cost of energy purchased from CPPA-G during the current month, K-Electric has used the rate of Rs. 10.664/kWh, however, the Authority’s approved fuel cost component in the matter of XWDISCOs for the current month is Rs. 10.60 1/kWh. This has resulted in decrease in total fuel cost by around Rs.47 million.
Accordingly, for working out the FCA of April 2022, the Authority has used FCC of Rs.6.6994/kWh for both SNPC and SNPC-II, as approved vide decision dated 20.11.2020.
KE had provided information regarding Net Metering units purchased, along with the FCA request of April 2022. As per the working of KE, it has calculated a loss of Rs.28.51 million because of Net Metering. The Authority observed that KE is receiving excess Net Metering units which become part of its power purchase. Keeping in view the fact that the quantum of Net Metering has reached a reasonable size and the power purchase cost of KE has increased exponentially as compared to the units purchased through Net Metering, the Authority has decided to include both the units purchased by KE through Net Metering along with its cost in the FCA being in the interest of the consumers. Keeping in view, that KE has Net purchased 1.67 GWh at a cost of Es. 21.62 million the same has been made part of instant FCA decision.
With regards to the underutilization of efficient plants, it was observed that KE operated Unit 1 of BQPS-I at minimum loading of 100 MW instead of 90 MW. Since it has been observed that the plant can operate at a minimum loading of 90 MW, the same amount should not be allowed to KE unless satisfactory justification has been provided. In view of the above, an amount of Rs. 1.7 million has been deducted from the FCA claim of KE for the month of April 2022.
The increase shall be applicable to all the consumer categories except lifeline consumers. K-Electric shall reflect the fuel charges adjustment in respect of April 2022, in the billing month of July 2022.

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