Nepra defends Rs7.6 cut in K-Electric tariff

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Wednesday defended its decision to cut K-Electric’s multi-year tariff by more than Rs7.60 per unit, saying that the decision was made after thorough deliberation and hearing the parties.

The hearing was chaired by Nepra Member (Law) Amina Ahmad, while other members of authority were also present.

“Yes, this decision was made after the collective wisdom of Nepra, as all members have signed the decision,” responded Ms. Ahmad, adding that the authority’s judgment was unanimous and independent. She further clarified that Nepra had “nothing to do with subsidies being given by the federal government.”

Earlier this week, the Power Division also backed Nepra’s revised tariff for K-Electric, rejecting claims it penalizes Karachi consumers. It said the decision shields consumers from inefficiency-driven costs, ends dollar-based profit indexation and pegs returns in rupees. The ministry noted that KE has lagged in recoveries, loss reduction and service quality, adding that the new framework aligns it with other utilities, curbs excess profits and ensures no extra load-shedding.

During the hearing, the official informed that electricity consumption fell by 5 percent in September, driven by a surge in solar power adoption and slower economic activity.

The officials however said that the government is to give incentive packages for industries to revive electricity consumption amid the economic slowdown.

The regulator reviewed the Central Power Purchasing Agency’s (CPPA) request for a 37-paisa per unit reduction in electricity tariffs, which—if approved—would apply to all power distribution companies, including K-Electric, and provide about Rs4.5 billion in relief to consumers in their November bills.

Officials from the National Power Control Centre (NPCC) revealed that widespread solarisation has sharply altered power demand patterns, with daytime consumption dropping by nearly 6,000 megawatts, sometimes falling to 15,000 MWs, while nighttime demand spikes beyond 21,000 MWs.

“Power plants cannot be switched on or off instantly to match this daily fluctuation,” NPCC officials said, warning that solar-driven demand shifts are creating operational inefficiencies across the national grid.

CPPA officials added that no power was generated from the China Power Hub Generation Company in September, and that Rs9.34 billion in prior adjustments have been sought for recovery. They said industrial demand also declined by around 5 percent, citing high tariffs and reduced production. Nepra noted that furnace oil-based power plants operated 6 percent more last month to meet demand fluctuations.