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NEPRA Approves Increase in Power Tariff for Ex-Wapda Discos

NEPRA Approves Increase in Power Tariff for Ex-Wapda Discos

Rise in Fuel Charges Results in Tariff Adjustment

The National Electric Power Regulatory Authority (NEPRA) has granted permission for an increase in power tariff for the Ex-Wapda Discos (XWDISCOs) due to fuel charges adjustments (FCA) in April.

Variation in Fuel Charges Leads to Tariff Adjustment

According to NEPRA’s decision, the applicable tariff for Ex-WAPDA DISCOs will see a rise of Rs1.6075/kWh. This adjustment is based on the variation in fuel charges during April 2023.

CPPA-G Petitions for Tariff Increase

The Central Power Purchasing Agency-Guarantee (CPPA-G), representing power distribution companies (XWDISCOs), submitted a petition to NEPRA regarding the increase in tariff. They stated that the consumers’ reference fuel charges for April were Rs8.3875/unit. After considering the previous adjustments, the total cost per unit amounted to Rs10.3975/unit. The CPPA-G requested permission to pass on the increase of Rs2.0100/unit to the consumers.

NEPRA’s Decision and Consumer Impact

However, NEPRA conducted a public hearing on the matter and further analyzed the data. They concluded that the actual cost of electricity was Rs9.9950/unit, while the reference fuel charges from consumers were Rs8.3875/unit. Consequently, NEPRA approved a hike of Rs1.6075/unit instead of the CPPA-G’s claimed Rs2.010/unit. This decision will burden power consumers with over Rs20 billion in their June bills.

Fuel Cost Adjustments for Power Plants

Furthermore, in April 2023, the fuel cost for several power plants, including Foundation Power, Saif Power, Halmore 43, and Thar Coal Block-I, was adjusted downward. As a result, the CPPA’s claim for these power plants reduced by Rs160.2,756 million, as per the NEPRA decision.

System Constraints and Financial Impact

During the hearing, the Authority noted that costly power plants generated energy in April 2023. However, due to various reasons, the system operator limited the withdrawal of energy from efficient power plants. These reasons, along with their financial impact, included system constraints such as transmission network congestion/overloading amounting to Rs2,079 million, contractual obligations of Rs.306 million, permanent transmission line outage costing Rs757 million, and the financial impact due to underutilization of efficient power plants of Rs584 million.

Provisional Withholding and Justification

Considering these factors, the Authority provisionally withheld an amount of Rs3,726 million from the FCA claim for April 2023. The withheld amount will only be released when the National Transmission and Dispatch Company (NTDC) provides complete justification to satisfy the Authority. As the deduction is made due to deviations from the Economic Merit Order (EMO) by the NTDC’s subsidiary, the Authority directed the CPPA-G to pass on the impact of the deduction to NTDC.

Tariff Increase Applicability

This tariff increase will apply to all consumer categories except Electric Vehicle Charging Stations (EVCS) and lifeline consumers.