ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has approved negative adjustment of Rs 1.9 per unit for second quarter of FY 2024-25 for the consumers of Discos and K-Electric except lifeline and prepaid consumers.
The Authority conducted a public hearing on the components of QTA submitted by the Discos and asked different questions on the authenticity of figures shared with the Authority and later on Chairman NEPRA raised the matter of discrepancy in the figures of Nepra and Power Division.
According to the notification, in pursuance of Proviso (ii) to Sub-Section 7 of Section 31 of the Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 (XL of 1997), Nepra has notified complete decision of the Authority in the matter of Requests filed by Discos for periodic adjustment in tariff for the 2nd Quarter of FY 2024-25 already intimated to Power Division on March 27, 2025.
Dec, Nov 2024 respectively: Nepra approves Rs1.23/unit cut in FCAs of Discos, KE
The Authority has decided to allow negative quarterly adjustments of Rs.56.380 billion pertaining to the 2nd quarter of the FY 2024-25, in a period of 03 months, ie, April 2025 to June 2025, at a uniform rate of negative Rs.1.9004/kWh, to be applicable to all consumer categories, except lifeline consumers and prepaid consumers.
In view of relevant provisions of NEPRA Act, NE Policy and Policy Guidelines issued by the Federal Government, the Authority has decided to allow the application of instant quarterly adjustments on the consumers of K-Electric as well, with the same applicability period. Accordingly, the instant quarterly adjustment of negative Rs.1.9004/kWh shall also be charged from the consumers of K-Electric except life line and prepaid consumers, to be recovered in a period of 3 months, ie, April 2025 to June 2025.
Meanwhile, Nepra has also approved negative adjustment of Rs 0.4641/kWh for Discos for the month of February 2025 to refund about Rs 3 billion to the consumers. The hearing in this regard was held on March 26, 2025. The negative adjustment will be passed on to the consumers in their bills of April 2025.
Considering the concerns raised by stakeholders during the proceedings, the Authority has noted:
(i) the persistent decline in sales is a serious concern.
Accordingly, the Power Division has been urged to conduct a thorough study to identify the root causes of this downward trend in demand
(ii)the operation of power plants outside the economic merit order is causing significant financial strain and increasing the Electricity Purchase Price (EPP).
Power Division has been advised to take immediate action to address the issue of merit order violations, ensuring that such events are prevented in the future to minimize their impact on Fuel Cost Adjustments (FCAs);
(iii) given the forecast low hydrology in the coming months, Power Division should formulate a comprehensive mitigation plan. This plan must prioritize the full utilization of cost-effective power sources such as nuclear, local (Thar), and imported coal plants, while ensuring the transmission network effectively delivers this cheaper electricity to minimize the impact on consumers; and
(iv) the Authority has taken serious notice of NTDCs repeated failure to complete transmission system projects within the designated timelines and budgets, as well as the consistent failure to meet deadlines. These delays not only compromise the reliability and security of the system but also adversely affect the financial stability of the power sector. In particular, the Authority is concerned with the delays in completing key grid and transmission line projects, including but not limited to the Lahore North Grid Station and SCADA systems etc.
The Authority directed NTDC to prioritize these projects and ensure their completion without any further delays.
In light of Power Division letter of February 26, 2025 regarding applicability of negative FCA to non-protected domestic and agriculture categories, the Authority during reconciliation of negative FCA’s not passed on to the consumers from July 2024 till February 2025, with CPPA-G, PITC and Discos, observed that impact of such retained amounts works out as Rs.23 billion for the period July 2024 till February 2025.
In past such retained amount was adjusted in the overall subsidy claims of Discos, however, owing to recent letter of MoE, the matter was deliberated upon.
In light of discussions , the Authority has decided to pass on the impact of such negative retained FCA’s of Rs.23 billion to all consumers (except life line and protected domestic category) for a period of three ) month i.e. April to June 2025.
The benefit of Rs. 23 billion shall be passed on to these consumers Rs.0.90/kWh, based on projected sales from April to June 2025, as per the notified tariff excluding the sales of life line and protected consumers. The impact of any under/over recovery of the allowed amount shall be made part of PYA by Discos in their upcoming tariff petitions.
Copyright Business Recorder, 2025
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