FCA for Dec 2022: Nepra asks Discos to refund Rs2.3/unit to consumers

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Thursday allowed the state-run power distribution companies (Discos) to refund Rs2.3166/unit on account of monthly fuel charges adjustments (FCA) for December 2022.

The authority asked the distribution companies to refund this per unit price to the power consumers in their February 2023 bills.

Nepra notified the decision, which shall be applicable to all the consumer categories except lifeline consumers, domestic consumers using up to 300 units, agriculture consumers and Electric Vehicle Charging Stations (EVCS), consumers of all the power distribution companies (Discos) except the consumers of K-Electric.

“It is hereby clarified that 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,” reads the Nepra notification.

Actual Fuel Charges Component for December 2022 was registered at Rs7.0027/ per kilo watt hour (kWh) while the corresponding Reference Fuel Charges Component were fixed at Rs9.3193/kWh and the fuel price variation recorded at Rs2.3166/kWh for the month of December 2022.

Earlier, Nepra on January 31, 2023 conducted a hearing on the application of the Central Power Purchasing Agency (CPPA) to consider variation in FCA of December 2022. After an initial scrutiny of the data, Nepra hinted at the approval of Rs2.3166/unit cut in the power tariff for the consumers of Discos. The CPPA, in its application on behalf of Discos, requested Rs2.20 per unit reduction in the power tariff under the head FCA for December 2022. During the month, 8,416.91 GWh of electricity was generated at the cost of Rs59.289 billion (or Rs7.0441/unit) and 8,096.88 GWh had been delivered to Discos at Rs57.648 billion (or Rs7.1198/unit). The transmission losses during December were 3.35 percent (or 282.10kWh).

The power regulator will hold a public hearing on the petition of CPPA-G on January 30, 2023.

In earlier months, Nepra had been allowed to collect additional amounts from the consumers due to the high cost of imported fuel. The FCA for November 2022 was Rs4.3/unit, which would be collected in January 2023 bills. However, for October, the FCA was negative 0.3213/unit, which was being refunded to consumers in their December bills.

It should be noted that cost of other fuels went up on YoY basis. The cost of RFO increased by 16 percent, RLNG went up 12.5 percent, whereas domestic gas price increased by 25 percent.

The power generation data showed that it was down by 4.7 percent YoY during December of this fiscal compared to the same month of last fiscal. Power generation went down by 4.7 percent YoY to 8,417 GWh (11,313MW) during the month under review compared to 8,828 GWh (11,866MW) during the same month of the last financial year. On MoM basis, generation increased by 0.6 percent.

It is pertinent to mention that the FCA is reviewed every month as per the tariff regime applicable across the country and is usually applicable to the consumers’ bills for one month only. FCAs are linked with changes in global fuel prices and passed onto consumer bills under prescribed rules and regulations of Nepra and the Government of Pakistan.