Nepra reviews KE’s Rs68bn write-off claims

KARACHI: The National Electric Power Regulatory Authority (Nepra) conducted a public hearing on Monday regarding K-Electric’s claims of Rs68 billion in unrecoverable dues from chronic defaulters for the period between FY17 and FY23.

These write-offs are allowed under the Multi-Year Tariff framework granted to K-Electric (KE), independent of the electricity rates charged to consumers under the uniform tariff policy. The claims, which have accumulated over seven years, are deemed critical to the utility’s financial stability, according to KE representatives.

The Rs68 billion covers dues that KE has been unable to recover despite extensive efforts, including multiple disconnections, collaborations with recovery agencies, and targeted initiatives in specific areas. KE stressed that the claims submitted to Nepra have undergone rigorous internal scrutiny and external audits by a reputable audit firm, as mandated by the regulatory authority.

Speaking during the hearing, a KE spokesperson highlighted the unique position of the utility, saying, “Unlike other power distribution companies (XWDISCOs), KE, as a private utility, does not contribute to the national circular debt. This distinction has been acknowledged by the World Bank and other global institutions. Disallowing legitimate claims will directly impact KE’s cash flows, undermining our ability to invest in infrastructure upgrades and ensure reliable power supply for Karachi.”

The hearing marks another step in KE’s ongoing engagement with Nepra to resolve the matter. The utility stressed that addressing the issue is vital for its capacity to enhance power supply and implement infrastructural improvements in Karachi.