MUSHTAQ GHUMMAN

ISLAMABAD: National Electric Power Regulatory Authority (NEPRA) has approved an increase of Paisa 51/kWh in KE’s tariff under Quarterly Tariff Adjustment (QTA) mechanism and negative adjustment of Rs5.1261/kWh in FCA for September 2022.

On Friday, the regulator issued two determinations. One is related to government’s motion to pass on Paisa 50.87/kWh to the consumers of KE for third quarter of 2021-22 to maintain uniform tariff across the country whereas the second is related to FCA for September 2022.

The Authority in order to provide a fair opportunity to the Federal Government to present its case and all the relevant stakeholders involved, decided to conduct a hearing in the matter, which was held on November 8, 2022. The Federal Government during the hearing reiterated its submissions made in the Motion and submitted that NEPRA determined quarterly adjustment of Discos for the 3rd quarter for the FY 2021-22 of Re 0.5087/kWh. Pursuant to notification of Discos, the MoE has filed the Motion with respect to recommendation of consumer end tariff, to charge the same amount from the consumer of K-Electric to make tariff uniform. Upon inquiry from the Authority to apply the quarterly adjustments determined for Discos automatically to K-Electric at the time of its determination, the MoE submitted that Discos quarterly adjustments are determined and notified by the Authority, so the same is applied automatically. However, in case of K-Electric, for the purpose of making the tariff uniform, approval is sought from the Federal Government.

Tanvir Barry, representing KCCI submitted during the hearing that the proposed adjustment of Re0.5087/kWh may not be charged from the consumers of K-Electric. The MoE in response submitted that currently the determined tariff of K-Electric is around Rs43/kWh, whereas its present applicable tariff is around Rs26/kWh, thus resulting in annual subsidy of around Rs291 billion.

Upon submissions of Arif Bilwani that tariff of K-Electric vs rest of the Discos is not uniform to the extent of monthly FCAs, the MoE explained that for making monthly FCAs of KE and Discos uniform, a summary has been prepared and once approved by the Federal Government, it would be submitted for consideration of the Authority.

NEPRA observed that despite the proposed increase of Re0.5087/kWh for all categories of the consumers except life line, the Federal Government would be picking up subsidy of around Rs291 billion as explained by the government during the hearing, after which the Authority has decided to accept the Motion filed by the Federal Government.

The Authority has also accepted the request of the Federal Government to issue a separate Schedule of Tariff (SoT) for the allowed increase of Re0.5087/kWh for all categories of consumers except life line. The increase will be applicable for a period of three months - November 2022, December 2022 to January 2023, on consumption of September 2022, October 2022 and November 2022 respectively. The amount so allowed shall be accounted for by K-Electric in its subsidy claims. The Federal Government has been requested to adjust this amount while processing the subsidy claims of K-Electric.

NEPRA held a public hearing on October 25, 2022 to determine actual financial impact of FCA on KE consumers in September as KE had sought negative Rs4.622/kWh. However, NEPRA has approved FCA of negative Rs5.1261/kWh for the month of September 2022.

According to NEPRA, negative impact of August was Rs4.89/kWh versus Rs5.1261/kWh, which implies that total negative impact will be of Paisa 24/kWh for September 2022.

The negative adjustment shall be applicable to all the consumer categories except lifeline consumers, domestic consumers consuming up-to 300 units, agriculture consumers and EVCS (Electric Vehicle Charging Station) consumers of K-Electric. The negative adjustment on account of monthly FCA is also applicable to the domestic consumers having Time of Use (ToU) meters irrespective of their consumption level.