The National Electric Power Regulatory Authority (Nepra) has announced that electricity rates for consumers of ex-Wapda distribution companies (Discos) will increase next month, even as fuel costs decrease. This change comes after a public hearing regarding fuel cost adjustments for September.
Summary of Changes
- Net Increase: Consumers will see a rise of 15 paise per unit in November, pending Nepra’s approval of a 71 paise refund demanded by Discos.
- Current Adjustments: The 86 paise per unit negative adjustment in October bills will be replaced by a 71 paise negative adjustment in November.
- Impact of Consumption Patterns: A significant decrease in electricity generation and consumption was noted, attributed to high tariffs and reduced purchasing power.
Key Details
During the hearing led by Nepra Chairman Waseem Mukhtar, it was revealed that:
- Electricity Generation: In September, electricity generation fell by 9.9% compared to estimates and was 6.4% lower than the previous year.
- Tariff Adjustments: Quarterly tariff adjustments could increase rates by Rs40-45 billion, although settling some outstanding cases may mitigate this increase.
- Fuel Costs: The average fuel cost for September was Rs9.09 per unit, up nearly 20% from Rs7.62 the previous year.
Factors Influencing the Increase
- Dues to Sugar Mills: The Central Power Purchasing Agency (CPPA) claimed over Rs7.5 billion in dues, although some disputed this.
- Closure of Neelum-Jhelum Project: The recent shutdown due to a tunnel collapse is expected to have financial implications, as it leads to higher reliance on costlier energy sources.
- Fuel Mix: Hydropower remains the cheapest source, while LNG and coal are more expensive options.
Consumer Impact
The fuel cost adjustments will be reviewed monthly, applying only to consumers’ bills for that specific month. Notably, domestic consumers using up to 300 units per month will not benefit from the lower fuel cost adjustments.
