Nepra approves Rs24.5bn refund for consumers

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has approved a refund of Rs 24.5 billion — at the rate of Rs 1.7856 per unit — for power consumers across the country, including K-Electric, except lifeline consumers, under the monthly Fuel Charges Adjustment (FCA) for July 2025.

Nepra conducted a public hearing on August 28, 2025, to review the generation data submitted by the Central Power Purchasing Agency-Guaranteed (CPPA-G).

According to a notification issued on Tuesday, the actual national average uniform FCA for July stood at Rs 8.0903/kWh, compared to the reference cost of Rs 9.8758/kWh. This resulted in a negative adjustment of Rs 1.7856/kWh for consumers of distribution companies (DISCOs) and K-Electric.

The authority confirmed that the negative adjustment will apply uniformly across the country, including K-Electric, which currently draws about 2,000 MW from the national grid. However, the relief will not be extended to lifeline consumers, protected consumers, electric vehicle charging stations (EVCS), or pre-paid electricity consumers.

DISCOs and KE are directed to incorporate the July FCA adjustment in the bills for September 2025. The adjustment must be shown separately, based on the units consumed in July. In cases where September bills have already been issued before this notification, the adjustment will be reflected in the following month’s bills. NEPRA also directed that implementation of this decision must comply with court orders.

In an additional note, Member (Technical) Rafique Ahmad Shaikh highlighted that persistent governance failures in the power sector continue to inflate costs and undermine system efficiency. He cited prolonged outages, delayed project execution, and inadequate transmission planning as major contributors to higher generation costs and monthly FCAs.

He pointed to the continued forced outage of Guddu Unit-16 and the prolonged shutdown of the Neelum-Jhelum project as prime examples. The 747 MW Guddu unit alone added Rs 968 million in costs during July 2025, pushing cumulative losses to Rs 121.32 billion since July 2022. Meanwhile, Neelum-Jhelum remains idle despite Rs 75.5 billion already recovered from consumers through a dedicated surcharge.

Shaikh further noted that delays in critical projects such as the Lahore North Grid Station and SCADA-III expose deep-rooted inefficiencies. Transmission constraints—including underutilization of the HVDC line (operating at just 39%) and South-North corridor bottlenecks—added another Rs 91 million in avoidable losses in July. Part Load Adjustment Charges (PLAC) hit Rs 4.3 billion in July and Rs 41.2 billion in FY 2024-25, reflecting poor demand planning and weak system reliability.

“These recurring failures are not isolated incidents but symptoms of chronic mismanagement,” Shaikh stressed. “Immediate and coordinated reforms are needed to address inefficiencies, stabilize FCA, and restore sectoral sustainability. However, accountability remains the missing link. Without holding institutions and individuals responsible for delays, inefficiencies, and poor decision-making, reforms alone cannot deliver lasting improvements.”—MUSHTAQ GHUMMAN