Nepra orders FCA refunds in July bills

ISLAMABAD: Electricity consumers across Pakistan will get relief in their July power bills, as the National Electric Power Regulatory Authority (Nepra) on Wednesday ordered state-run power distribution companies (Discos) and K-Electric to refund Rs0.495 per unit and Rs4.0349 per unit respectively.

These decisions were taken under monthly fuel charge adjustments (FCA) for May (Discos) and April (K-Electric). The decision comes as a respite for inflation-weary households and businesses, though the regulator warned that systemic inefficiencies continue to inflate energy costs and burden the national grid.

The refunds will apply to all consumer categories except lifeline users, protected domestic users, electric vehicle charging stations (EVCS), and pre-paid customers.

Discos had originally sought to collect Rs0.1015 per unit in additional charges, but NEPRA rejected the plea and instead mandated refunds.

K-Electric, which had proposed a refund of Rs4.69/unit, was directed to refund a slightly lower amount of Rs4.0349/unit.

In a strongly worded technical note accompanying the decisions, NEPRA’s Member (Technical) lashed out at both K-Electric and government-run Discos for poor performance, chronic inefficiencies, and mismanagement that have led to billions in avoidable losses.

The note revealed that in April 2025, K-Electric drew only 1,014 MW from the National Transmission and Despatch Company (NTDC) — just 63% of its 1,600 MW limit — due to delays in finalizing a transmission link. The shortfall led to inefficiencies and Rs593 million in Partial Load Adjustment Charges (PLAC).

NEPRA also criticized KE for poor dispatch from the Bin Qasim Power Station-III (BQPS-III), prolonged minimum-load operations, and rising aggregate technical and commercial (AT&C) losses. The authority urged KE to end load-shedding based on AT&C losses and take immediate corrective measures.

The regulator was even more critical of state-run generations, citing a pattern of mismanagement that has led to soaring generation costs. A key concern was the prolonged outage of Guddu’s 747 MW steam turbine, which has cost the national exchequer Rs116 billion since July 2022.

Continued operation in open-cycle mode alone led to Rs549 million in losses in May 2025. Additional inefficiencies included PLAC charges of Rs4.42 billion in the same month and underutilization of the costly High Voltage Direct Current (HVDC) infrastructure, which operated at just 40% capacity, resulting in another Rs591 million in avoidable losses.

The NEPRA member also demanded urgent updates from the CEOs of GENCO-II and Neelum Jhelum hydropower plant, citing Rs6.4 billion in May losses from the Neelum Jhelum’s prolonged outage.