MUSHTAQ GHUMMAN

ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has dismissed review motions against upfront tariff for gas-fired Captive Power Plants (CPPs) for short-term utilization of available generation capacity.

The regulator had initiated suo motu proceedings for determination of upfront tariff for short-term utilization of the available generation capacity from captive power plants on gas. The upfront tariff was issued on July 31, 2017.

According to the Authority, the upfront tariff on gas for CPPs comprised of fuel cost component and fixed cost component. The fuel cost component was allowed on the basis of newt LHV thermal efficiency of 37.50 per cent, LHV-HHV factor of 1.1076 and reference gas price of Rs 600 per MMBTU.

The regulator had approved upfront tariff of Rs 7.6973 per unit for CPPs of which Rs 6.0469 per unit was for reference fuel cost component and Rs 1.6504 per unit fixed cost component.

The two companies i.e. Sitara Energy Limited (SEL) and Mekotex Limited (MPL) had challenged the determination of July 31, 2017, seeking review of following items: (i) efficiency, fuel cost component and degradation; (ii) O&M; (iii) plant availability;(iv) Return on Equity ;( v) cost of working capital ;(vi) indexation of fixed cost component;(vii) restriction on operation on RLNG, and (viii) applicability period.

The Authority admitted the review motions of both companies. In order to consider the review motions an opportunity of hearing was granted to the petitioners. Hearing was held on October 17, 2017 in Nepra offices Islamabad which was attended by the petitioners. During the hearing the petitioners did not produce any additional evidence in support of their review motions nor could point out any error in the impugned determination.

After reviewing the stated facts, the Authority maintained that in terms of Regulation 3(2) of the Nepra (Review Procedure) Regulations, 2009, a motion seeking review of any order or decision of the Authority is competent only upon discovery of new and important matter of evidence or on account of some mistake or error apparent on the face of record or for any other sufficient reason.

According to the regulator, the perusal of impugned determination sought to be reviewed clearly indicated that all material facts and issues were examined in detail and there was no occasion to amend or modify the determination. The Authority was convinced that the review motions of both companies would not result in the withdrawal or modification of determination, hence review motions were dismissed.