Nepra allows Discos to hike power tariff by Rs1.95 per unit

ISLAMABAD – National Electric Power Regulatory Authority (Nepra) has allowed the power distribution companies (Discos) to increase the power tariff by Rs 1.95 per unit amid protest from the member Sindh, who has termed the transfer of the cost of inefficiencies, mismanagement and transmission constraints caused by various power sector entities to the consumers as unjustified.

National Electric Power Regulatory Authority (Nepra), in its decision, has allowed XWDiscos to charge additional Rs 1.95 per unit in electricity bills from the power consumers under the monthly fuel charges adjustment (FCA). The decision will have an impact of Rs 30.4 billon on the power consumers.

CPPA-G had requested to allow increase of Rs.2.0719/kWh, having impact of Rs.32.30 billion. Nepra had conducted a public hearing on September 30, 2021 over the petition and approved positive FCA of Rs.1.9539 per unit. 

Member Sindh has written his dissent note. In his dissent note on the Nepra’s decision, Member Sindh Nepra, Rafiq Ahmad Sheikh said that CPPA-G reported 166 instances of plants operation in violations of merit order due to system constraints that resulted in financial impact of Rs 1.872b during the month of August 2021.Such constraints in transmission system is failure of relevant entities like NTDC, and the financial impact due to such constraints cannot be passed on to the consumers.

CPPA-G again failed to submit the segregation of financial impact into heads like impact on account of fuel shortage, system constraints, underutilization of efficient power plants etc; and as such the mismanagement into the availability of required RLNG can’t be passed on to the consumers.

Further, huge amount under the head of previous period adjustments can’t be passed on to the consumers without detailed audit, member Sindh said. Therefore FCA request of CPPA-G only be presented before authority after financial and technical audit.

The FCA of August 2021 shall be charged in the billing month of October 2021 to all consumer categories of XWDISCOs, except life line consumers. This FCA would remain applicable only for one month. This FCA is not applicable to KE consumers. 

In a petition submitted to NEPRA on the behalf of power distribution companies (XWDISOCs), CPPA-G said that for the month of August the reference fuel charges from the consumers were Rs 4.7334 per unit while the actual fuel cost was Rs 6.8053 per unit, therefore it should be allowed to pass the increase of Rs 2.0718 to the consumers under fuel charges adjustment for August 2021.

In the hearing Nepra had questioned that why Rs. 10 billion extra was spent on power generation from furnace oil in August. The hearing was informed that power plants received 300 mmcfd less gas than the demand for power plants.

The regulator also questioned that why power plants with low efficiency rates were operated during the month of August. 

As per the data submitted by CPPA-G, the total energy generated during August was 16078.09 GWh at a basket price of Rs 6.4122 per unit. The total cost of electricity was Rs 103.097b. According to the CCPA-G data, net electricity delivered to Discos was 15,590.87 GWh with the total price of Rs 106.100b at a rate of Rs 6.8053 per unit. The CPPA-G in its tariff petition said that since the reference fuel charges for August 2021 were estimated at Rs 4.7334 per unit whereas the actual fuel charges were Rs 6.8053 per unit, hence it was pleaded to allow an increase of Rs 2.0719 per unit.

According to the data submitted to Nepra, in August 2021, hydel generation was recorded at 5594.30 GWh or 34.79 percent. In July, the hydel generation was 4,694.67 GWh or 29.94 per cent of total generation. Coal-fired power plant contributed 2293.83 GWh or 14.27 percent of total generation at a rate of Rs 9.0322 per unit, HSD contributed 19.84 GWh or 0.12 percent at Rs 22.6251 per unit. RFO based generation was 1,627.56 GWh or 10.12 per cent at Rs 18.2403 per unit. Electricity generation from gas-based power plants was 1,313.21 GWh or 8.17 percent at Rs 8.3082 per unit, RLNG contributed 2895.92 GWh or 18.01 per cent at Rs 13.4401 per unit.

The generation from nuclear power plants was 1,630.19 GWh or 10.14 per cent at Rs 0.9986 per unit and electricity imported from Iran was 45.24 GWh at Rs 12.3557 per unit. The power generation from baggasse was recorded at 24.06 GWh at Rs 5.9822 per unit. The power generation from different sources (mixed) was 16.98 GWh at a price of Rs 4.6705 per unit, while generation from wind was recorded at 549.95 GWh or 3.42 per cent and solar generation was 67.01 GWh or 0.42 per cent.

Article source: https://nation.com.pk/09-Oct-2021/nepra-allows-discos-to-hike-power-tariff-by-rs1-95-per-unit