An increase in electricity tariffs by 54 paisa per unit is being sought

Islamabad:

The National Electricity Regulatory Authority (Nepra) on Wednesday voted the Central Power Purchases-Assurance Authority (CPPA-G) for expensive power generation while ignoring cheaper local coal-based generation, which puts additional burden on consumers.

In a public hearing, the CPPA-G demanded an increase of Rs 0.5471 per kilowatt hour (kWh) in the price of electricity due to the fuel charge adjustment (FCA) for September 2023.

It was noted that local coal-fired power generation remained at a lower level, which concerned the power sector regulator.

“The local coal-based electricity generation is low because the electricity was not generated with the help of cheap coal,” asked a Nepra member.

The regulator observed that power plants that run on expensive fuels are favored, while plants that generate cheap electricity are ignored.

Nepra officials noted an additional charge of Rs 274.26 million due to system malfunction in September. It was further informed that there was a financial impact of Rs 13.64 million due to underutilization of efficient power plants.

Earlier, CPPA-G filed a petition, seeking a hike in tariffs by Rs 0.5471 per kWh. CPPA-G, on behalf of electricity distribution companies (DISCOs) other than K-Electric, has requested Nepra to approve the tariff hike on behalf of FCA for September 2023.

It claimed that 13,339 gigawatt hours (GWh) of electricity was generated with various fuels in September at a price of Rs 7,417 per unit. The total cost of the power was estimated at Rs 98,938 million.

Hydropower generation stood at 5,009 GWh constituting 37.55% of the total generation, while local and imported coal-fired units generated 2,123 GWh at Rs 23.4119 per unit and with a share of 15.91%.

Electricity generation through residual fuel oil reached 241 GWh, or 1.8% of total generation, at Rs 37.0491 per unit.

Similarly, gas-fired units generated 1,005 GWh, accounting for 7.54% of total generation, at Rs 13.5206 per unit. Electricity generation with the help of regasified liquefied natural gas (RLNG) stood at 2,128 GWh, constituting 15.95% of the total generation, at Rs 24.1876 per unit.

Power generation from bagasse was recorded at 35 GWh, which cost Rs 5.9822 per unit. Wind power generation was 410 GWh, or 3.08% of total generation, and solar power generation was 79 GWh, or 0.59%.

In addition, electricity generation from nuclear sources stood at 2,286 GWh, which constituted 17.14% of the total generation, at a price of Rs 1.1975 per unit. From Iran, 24 GWh of electricity was imported, which cost Rs 23.7976 per unit and had a share of 0.18% in the total generation.

CPPA-G informed Nepra that net 12,922 GWh (96.88%) of electricity was delivered to DISCOs in September at Rs 7.6182 per unit. The total price came to Rs 98.443 million.

In the month, the reference price of electricity was Rs 7.0711 per unit, while the actual cost was estimated at Rs 7.8182 per unit.

Published in The Express Tribune, November 2^n.d2023.

Like Businesses on Facebook, follow @TribuneBiz on Twitter to stay updated and join the conversation.