3rd QTA for FY23: Power consumers to pay Rs46.28bn more in July-Sept

ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has indicated that ex-Wapda Discos may be allowed to pay an additional Rs46.28 billion, including Rs31 billion for capacity charges, through the quarterly tariff adjustment (QTA) mechanism for the third quarter of FY2023.

During a public hearing on the petitions of power distribution companies (XWDISCOs) on Wednesday here, NEPRA acknowledged that the electricity tariff would increase by Rs1.25 per unit, which would be recovered from consumers in three months, from July to September 2023. This hike will burden power consumers with Rs46.28 billion.

The proceedings were chaired by Chairman NEPRA Tauseef H Farooqi, with Engr Rafique Ahmad Shaikh, serving as Member (Technical), Engr Maqsood Anwar Khan as Member (Licensing) and Amina Ahmed a Member (Law).

Initially, the XWDISCOs had requested an amount of Rs44.46 billion for the Quarterly Adjustment pertaining to the third quarter of FY2022-23 for XWDICSOs, but later revised it to Rs46.28 billion. NEPRA stated that the increase in electricity tariff would amount to Rs1.25 per unit. The approved quarterly adjustment will be uniformly recovered from all consumers, excluding lifeline consumers.

The Authority heard the petitioners and would decide after conducting due diligence and considering the comments of all stakeholders.

NEPRA explained that consumers were previously charged an average of Rs0.47 per unit in the second quarter adjustment of FY2022-23, which is applicable until June 2023. Starting from July, the new hike of Rs1.25 per unit will replace the existing Rs0.47 per unit and will continue until September 2023. This adjustment will apply to all DISCOS customers, except Lifeline customers, and will not affect K-Electric consumers.

Out of the total additional amount of Rs46.28 billion, consumers will contribute Rs31 billion for capacity charges, which will be allocated to Independent Power Producers (IPPs) to cover the cost of electricity that power distribution companies (Discos) did not inject into the national demand due to system constraints or low electricity demand.

According to a NEPRA official, LESCO consumers will pay Rs9.3 billion for capacity charges, Gepco consumers will pay Rs4.7 billion, Fesco consumers will pay Rs8.3 billion, Mepco consumers will pay Rs7.3 billion, Hesco consumers will pay Rs3.9 billion, Qesco consumers will pay Rs1.4 billion, and Tesco consumers will pay Rs3.157 billion.

During the hearing, the NEPRA chairman addressed the issue of lower electricity consumption by Discos. The representatives of the XWDiscos explained that reduced demand from consumers resulted in lower electricity consumption and subsequently lower capacity charges. In addition to capacity charges, consumers will also pay Rs4.18 billion for variable charges, Rs544 million for losses and Fuel Cost Adjustment (FCA), and Rs11.7 billion for Use of System Charges (UoSC) and Miscellaneous Other Factors (MoF). NEPRA has reserved its judgment and will release a detailed decision after further examination of the data.