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K-Electric seeks Rs4.49 per unit hike in electricity price

  • April 21, 2023

ISLAMABAD-K-Electric has sought a hike of Rs 4.49 per unit in electricity price on account of fuel charges adjustment for the month of March 2023.  

In a petition submitted with National Electric Regulatory Authority (NEPRA), K-Electric has sought for positive FCA at the rate of Rs 4.49/unit. If approved by NEPRA, price hike will burden Karachittes by Rs 6.636 billion in their May bills. According to KE petition, Rs 4.49 per unit hike was claimed on the basis of variation in cost of fuel which was Rs 3.236 per unit, cost of fuel of power purchases was Rs 1.063 per unit, EMO and other adjustment Re0.191 per unit.

NEPRA has announced that the hearing for KE’s petition for fuel charges adjustments (FCA) for March 2023 will be held on 3rd May.

For the hearing following issues have been framed to be discussed: 

i. Whether the requested fuel price variation is justified? 

ii. Whether K-Electric has followed the merit order while giving dispatch to its power plants as well as power purchases from external sources?

Fuel charge adjustment (FCA) is incurred by utilities due to global variation in fuel prices used to generate electricity and change in generation mix. These costs are passed through to the customers following NEPRA’s scrutiny and approval and usually apply to only one month’s electricity bill. Customers also receive a benefit when the cost of fuel decreases. 

According to spokesman K-Electric, the hike in KE tariff is primarily due to an increase in fuel prices of RLNG and CPPA-G. The price of power purchased from CPPA-G in March 2023 has increased by 41% as compared with December 2022. Similarly, price of purchase for RLNG from SSGC increased by 14% from December 2022, while RLNG purchased from PLL increased by 20% in the same period. Furnace oil prices in March 2023 decreased by 10% from December 2022. The responsibility to determining FCA charges and any other costs to be recovered from customers in their monthly bills rests with NEPRA and the government of Pakistan and follows the prevailing rules and regulations of the country.

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