Islamabad             -         The government will seek the approval of Economic Coordination Committee (ECC) of the cabinet for the approval of Rs4.88 increase in power tariff for K-Electric consumers under 11 quarterly adjustments, it is learnt reliably here.

The government has decided that instead of transferring the burden of 11 quarterly adjustments to the power consumers of K-Electric in a single go and will seek ECC approval for the phase wise hike in power tariff, official sources said. The matter of tariff increase for K-electric on the agenda of ECC meeting, scheduled for today (Wednesday), sources told The Nation.

In December Nepra had approved the quarterly adjustment claims of K-Electric for the period from July.-September 2016 to January-March 2019 and allowed an increase of Rs4.88 per unit for the company’s consumers. The government was supposed to notify the increase, however now it has decided to refer the matter to ECC for approval and the matter to be referred to ECC and the power division will recommend phase wise increase in tariff for K-electric consumers.

If approved by the ECC, the decisions will allow K-Electric to collect Rs106 billion from the power consumers in Karachi in phases. The revised tariff works out as Rs17.67 per kWh and the impact of total amount being allowed is around Rs106 billion. The total amount would be recovered from the consumers in electricity bills for coming months. The electricity price has jumped from Rs12.81 per unit to Rs17.67 per unit registering an increase of around Rs4.8 per unit, Nepra official said.

The major reason for increase in power tariff was use of RLNG by K-Electric, having additional impact of Rs24 billion. The other reason was increase in prices of gas from reference price of Rs400 per MMBTU to Rs629 per MMBTU. Moreover, increase in price of Furnace oil (FO) was also another reason as its price went up from reference price of Rs27,000 per metric ton (MT) to around Rs70,000/MT. Increase in O&M and capacity cost of IPPs owing to indexation and exchange rate variation also led to hike in electricity rates.

The matter of subsidy for agricultural tube well consumers in Balochistan for 2019-20 is also on the agenda of the meeting. Allocation of gas to SSGC and provincial Tight gas price incentive for Rehman-4 well in Kirthar Block will also be discussed in ECC meeting, source said.

The meeting agenda also include allocation of technical supplementary grant for internal security duty allowances to Air Force and technical supplementary grant of Rs5 billion in favour of Higher Education Commission for current Financial Year 2019-20.