Monday March 27, 2023

Quarterly power tariff adjustment: Power consumers to pay additional Rs0.5087/unit in three months

July 30, 2022

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Friday allowed power distribution companies to collect additional Rs0.5087 per unit on account of quarterly adjustments for the fiscal year 2021-22 and will be charged next three consecutive months starting from September 2022.

The ex-Wapda Distribution Companies (XWDISCOs) will collect an additional Rs12.762 billion from power consumers as an adjustment for the third quarter (Jan-March 2021-22). The rise in tariff will not affect lifeline consumers (using less than 100 units a month) and incremental industrial sales for the Industrial Support Package.

Earlier, for the first quarter (July-Sept 2021-22), the power regulator allowed Rs0.517/unit with a combined impact of Rs14.3 billion. For the second quarter (Oct-Dec 2021-22), Nepra had allowed Rs1.55/unit increase for three months starting from July 2022. The second quarter adjustment will have a financial impact of Rs39 billion being collected from consumers.

Nepra issued its decision on Friday. It says that quarterly adjustments would not be passed on to B1, B2, B3, and B4 industrial consumers to the extent of incremental sales till the continuation of the instant package, according to the Nepra’s earlier decision dated December 1, 2020.

This increase in the electricity tariff will not be applicable to lifeline consumers and K-Electric consumers. Furthermore, the Nepra has conveyed its decision to the federal government, prior to its notification in the official gazette as per Section 31 (7) of the Nepra’s Act.

The authority has approved a positive amount of Rs12.762 billion on account of quarterly adjustment pertaining to the third quarter of FY2021-22 for the Discos to be recovered from power consumers.

Based on the adjustment mechanism, as prescribed in the notified tariff, Nepra has already determined quarterly adjustments of Discos till December 2021.

And the Discos now in line with the prescribed quarterly adjustment mechanism filed their adjustments requests on account of variation in power purchase price (PPP), including impact of Transmission and Distribution (T&D) losses, etc., for the third quarter of FY2021-22, i.e. from January to March 2021. The Nepra hearing in the matter was held on June 15, 2022.

Since the adjustment is being made in the already-notified uniform tariff, the authority has determined the impact of the third quarterly adjustment on a uniform basis along with the Disco-wise rate, which shall be reflected in the monthly bills of consumers of all the Discos, and any excess/less adjustment would be settled among the Discos at the CPPA-G level.