Nepra reserves decision on KE’s power price increase plea

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) reserved its decision Monday after hearing the federal government’s request to increase the price of electricity for Karachi by Rs6 per unit.

The government is seeking a tariff increase for two different quarterly adjustments, with additional collections from Karachi residents set for April to June 2023.During the hearing, Nepra officials said that the federal government had requested an increase in electricity prices for Karachi consumers in terms of quarterly adjustments to maintain a uniform tariff.

Furthermore, officials from the Central Power Purchasing Agency (CPPA) added that additional collections of up to Rs4.45 per unit from Karachi electricity consumers will be made from April to May 2023. In addition, collections of Rs1.55 per unit will be made from April to June 2023. Due to the increase, KE consumers will bear a burden of Rs20 billion.

The federal government submitted an instant motion to Nepra requesting the application of up to Rs4.45 per unit for the 1st quarter of FY 2022-23 (July to September) and Rs1.55 per unit for the 2nd quarter of FY 2022-23 (October to December) to consumers of K-Electric, previously determined by the regulator for ex-Wapda Distribution companies (XWDiscos).

Nepra had previously allowed a hike of up to Rs4.45 per unit in power tariff, enabling ex-Wapda Discos (XWDiscos) to transfer an additional burden of Rs42 billion to electricity consumers on account of quarterly adjustment for the first quarter of the ongoing fiscal year.

The Nepra directed that the additional burden be transferred during the months of February and March and will have an average impact of Rs3.30 per unit on the consumers, resulting in increasing per unit cost of various consumer categories from Rs1.4874/unit to Rs4.45 per unit. According to the National Electricity Policy, 2021, the government may maintain a uniform consumer-end tariff for K-Electric and state-owned distribution companies through direct or indirect subsidies. Accordingly, KE’s applicable uniform variable charge is also required to be modified to recover the revenue requirements of KE, determined by the Authority consistent with the uniform national tariff of XWDISCOs. To maintain uniform tariffs across the country and recover the revenue requirements of KE, the federal government filed an instant motion with respect to Consumer End Tariff Recommendations of KE.