K-Electric has sought an increase of Rs1.38 per unit in its tariff on account of fuel cost adjustment for October 2021.

National Electric Power Regulatory Authority (Nepra) Chairman Tauseef Farooqi on Thursday presided over a hearing that reviewed a K-Electric petition.

A petition was published in newspapers seeking a hike of Rs0.29 per unit in K-Electric’s tariff.

During the hearing, a request was made to increase the price of electricity by Rs1.38 per unit.

“Now ground realities have changed,” Farooqi said during the public hearing. “If fuel becomes expensive, the burden will be borne by consumers.”

The rise in fuel prices has had an impact on the entire country.

Nepra chairman stressed that the authority would consider the latest information only, adding that media would criticise the regulatory authority if the decision was based on facts.

Nepra reserved its decision on the K-Electric petition, saying that the authority would issue the decision after reviewing the statistics and data provided by the power utility.

A K-Electric spokesperson said that on November 12, 2021, the utility submitted a fuel cost adjustment request for Rs0.29 per kilowatt-hour (kWh) for October 2021.

“The request was based on CPPA-G’s fuel rate for September 2021, ie Rs7.4052 per kWh, which was the latest available rate at the time of filing,” he said.

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“Nepra held a hearing on CPPA-G petition on November 30, 2021 during which the rate for October 2021 was presented as Rs9.9165 per kWh.”

Considering the significant difference in both rates and its impact on K-Electric’s fuel cost adjustment, the company revised its request to Rs1.38 per kWh.

The final fuel cost adjustment would be decided by Nepra. The increase was mainly on account of a surge in prices of furnace oil, re-gasified liquefied natural gas (RLNG) and CPPA-G prices by 7%, 5% and 31% respectively.

“Fuel cost adjustment is required due to variations in fuel prices and sources used to generate electricity,” he elaborated. “Across Pakistan, these costs are passed through to the consumers following Nepra’s scrutiny and approval.”

He said “consumers also receive some benefit when the cost of fuel decreases”.

In both scenarios, there would be no impact on K-Electric’s profit as these were legitimate costs that were being recovered, the spokesperson added.

Published in The Express Tribune, December 3rd, 2021.

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