ISLAMABAD - The National Electric Power Regulatory Authority (Nepra) Thursday approved Rs3.24 per unit reduction in power tariff for ex-Wapda distribution companies (Discos) for the month of January under a monthly fuel adjustment formula.

The decision was taken by Nepra, in a public hearing, on a petition filed by Central Power Purchasing Agency (CPPA). According the details submitted by CPPA to Nepra, the share of hydropower production in the overall energy mix was dropped to 7.60 per cent due to closure of canals and reduction in water flows.

The CPPA had filed a petition requesting a decrease of Rs2.97 per unit on account of fuel adjustment, however the Nepra decided that a relief of Rs3.24 per unit shall be passed on to consumers for the month of January.

The consumers will get benefit of around Rs27 billion and the relief will be given in next month's bills.

This adjustment/relief adjustment will be available to domestic consumers in the entire Pakistan except for K-Electric and the lifeline consumers. The reason for not providing relief to the consumers of K-Electric was that it was a privatized company and distributing its own generated electricity to the consumers in Karachi and is not covered under this determination.

The relief will also not be available to the lifeline consumers consuming up to 300 units per month, as they were already being provided subsidized electricity.

The relief will also not be passed on to the industrial consumers who were already getting cheaper electricity.

The CPPA-G filed a petition before Nepra for a tariff cut on behalf of ex-Wapda distribution companies.

In its petition, the CPPA-G reported that it had charged consumers a reference tariff of Rs9.8670 per unit in January against the actual fuel cost of Rs6.8889per unit requesting a reduction of Rs 2.9781 per unit.

The reduction in actual generation cost was mainly because of a decline in fuel prices, mainly zero use of high speed diesel in power plants.

According to the CPPA-G, about 7982.32 GWh (Gigawatt hours) were generated in January and 7698.86 GWh delivered to distribution companies due to higher losses of 3.41percent (Rs 0.24 per unit) transmission and distribution losses.

It said the share of hydropower production in the overall energy mix in January dropped to 7.60 percent due to closure of canals. Wind and solar plants together contributed about 0.92 percent and 0.69 percent energy respectively at no fuel cost. The power generation from furnace oil-based power plants was 20.43 percent at a cost of Rs10.42 per unit. Similarly, the natural gas-based generation was 23.2 percent at a cost of Rs4.63per unit.

The generation from imported liquefied natural gas (LNG) also contributed 20.08 percent to the overall power supply at a rate of Rs9.24 per unit. The overall energy contribution from coal was 14.34 and its fuel cost of generation stood at Rs5.19per unit.

The share of imported electricity from Iran contributed around 0.48 per cent with a cost of Rs11.05 per unit. The CPPA said total energy was generated at a total cost of Rs48.57billion or Rs6.08 per unit, while 3.41 percent lesser power was supplied to distribution companies at a cost of Rs53.03 billion or Rs6.8889per unit.

The CPPA had requested to make previous adjustment of Rs4.63 billion or Rs 0.58 per unit on account of supplemental charges. However, the regulator turned down this requested and decided to pass on relief of Rs 3.24 per unit to the consumers.