September 18, 2010Print : National
ISLAMABAD: The International Monetary Fund (IMF) has asked the government to fully implement the power sector reforms and ensure that in future the power tariff is determined solely by the National Electric Power Regulatory Authority (Nepra), and has also sought an amendment to the Nepra Act, a senior finance ministry official told The News. ìUnder the proposed amendment, the Nepra would itself notify the power tariff in future,î he said.
“Effectively, it means that the government will have no role in notifying the power tariff and will also not be able to reduce the tariff, which would be determined by the electric power regulator.
Once these reforms come into play, the government will not be able to provide any solace to power consumers by disagreeing with the Nepra on power rates,” explained the official.
Currently, Nepra determines power tariff on quarterly and yearly basis, but the government notifies the tariff after considering and deciding as to how much increase in tariff may be passed on to the masses and how much the government should absorb through subsidy.
According to a senior Nepra functionary, once the Nepra Act gets amended, as desired by the IMF, then whatsoever electricity rates the power watchdog determines would automatically be notified and the government would virtually be out of the power tariff determining process.
It is relevant to mention that the Nepra Ordinance also lapsed on August 17, under which the regulator had the powers to notify only the power tariff determinations under the monthly fuel adjustment formula, but it never possessed the power to notify the power tariff determination on quarterly or yearly basis.
When contacted, Safeer Hussain, a top officer of Nepra, confirmed that the ordinance that had empowered the Nepra to notify its electricity tariff based on monthly fuel adjustment had lapsed and now the government was notifying even the monthly power tariff determinations.
As far as the quarterly and yearly tariff determinations are concerned, he said that Nepra had never had the powers to notify them, as these powers always rested with the government.
“The Nepra currently sends all tariff determinations to the Ministry of Water and Power, which notifies it but not necessarily as per the findings or recommendations of the power regulator,” Safeer Hussain said.