MUSHTAQ GHUMMAN

ISLAMABAD: National Electric Power Regulatory Authority (Nepra) on Friday approved a Rs 2.97 per unit reduction in power tariff for November 2014 under a monthly fuel price adjustment formula but the government has decided to pass on only Rs 2.37 per unit to consumers and keep the remaining 60 paisa for debt servicing of Discos.

It is pertinent to mention here that Prime Minister Nawaz Sharif had announced a reduction of Rs 2.32 per unit in tariff in Peshawar on the day when Chairman PTI was in Karachi as part of his anti-government campaign.

This unprecedented relief in power tariff is not applicable to consumers of K-Electric, a privatised entity which has sought only a 74 paisa per unit reduction for November.

Nepra authority took this decision at a public hearing presided over by Brigadier Tariq Sadozai (retd), the newly-appointed chairman, on Friday on a petition filed by the Central Power Purchasing Agency.

CPPA, in its petition, sought a reduction of Rs 2.917 per unit in tariff on account of monthly fuel price adjustment.

Earlier, Ministry of Water and Power had claimed that a relief of Rs 27 billion will be passed on to consumers which implies that there is a difference of Rs 8 billion in the estimates of Nepra and Water and Power Ministry.

According to the petition, CPPA informed the regulator that it delivered 6.544.14 billion units of electricity to Discos in November against a total generation of 6.655.93 billion units.

Fuel cost on power generation calculated at Rs 4.4997 per unit, while reference fuel cost was set at Rs 7.4167 per unit.

Hydel generation in November was 2.892 billion unit, which was 43.45 percent of total generation.

Power generation from coal was 15.34 GWh in November at a price of Rs 4.4998 per unit. Generation on diesel oil was 5.07 GWh but its price has not been mentioned in the petition in November.

Power generation from furnace oil stood at 1.384 billion in November which was 20.94 per cent of total generation. The cost of furnace oil-fired generation has been calculated at Rs 13.8582 per unit.

Gas-fired power plants generated 1.766 billion units in November which was 26.53 per cent of total generation. The price of gas-fired power generation has been estimated at Rs 4.1618 per unit.

The price of nuclear power has been calculated at Rs 1.1818 per unit, electricity imported from Iran at Rs 9.9 per unit and mixed (different sources) at Rs 9.7 per unit.

Later, Ministry of Water and Power issued a press release, saying subsequent to the announcement by the Prime Minister Nawaz Sharif; Nepra has completed the procedure for a reduction in electricity tariff for the nine Discos.

It was presented before the Cabinet Committee on Energy (CCE) chaired by the Prime Minister that an approximate amount of Rs. 28 billion was saved from the generation costs during the month of November 2014 out of which Rs. 8 billion was saved due to the falling international oil prices and Rs. 20 billion on account of better management and merit order generation resulting in saving more than 250,000 metric tons of oil consumption during the month, while producing almost the same amount of electricity.

According to the Water and Power Ministry an amount of around 92 paisa unit would be saved in generation costs out of which an amount of Re. 60 paisa per unit was required to pay for the power sector finances.

In the final assessment the Nepra authorities have determined the Fuel Adjustment Charges to be Rs. 2.9672/unit out of which Rs 2.3672/unit will be passed on to all the consumers of the nine distribution companies under the Ministry of Water and Power, the press release added.