Karachi Electric (KE) has warned the Power Division that notification of its consumers end tariff determined by Nepra on federal government''s request will be considered a violation of Sindh High Court''s (SHC''s) orders. This has been conveyed by the Counsel for KE to Secretary Power Division in a letter dated July 26, 2018, a copy of which has also been sent to Chairman National Electric Power Regulatory Authority (Nepra).
KE''s management is unhappy with the federal government for creating hurdles in the purchase of 66.4 percent stake at a price of $ 1.77 billion between M/s Abraaj of Dubai and China''s M/s Shanghai Electric Power (SEP). The KE counsel sent a letter in response to the decision on the reconsideration request of July 5, 2018 against the power utility which substantially upheld the Multi Year Tariff (MYT) determination for the period July 1, 2016 to June 30, 2023 and the decision on the motion for leave to review of October 9, 2017.
According to the letter, KE approached Sindh high Court in its suit number 1467 of 2018 against DRR. On July 26, 2018, SHC passed an ad interim order with the following directions: "be that as it may let notice be issued to the defendants as well as Deputy Attorney General for the next date of hearing. In the meantime, no adverse action without due process of law shall be taken by the defendants against plaintiff in respect of impugned DRR." Secretary Power has been asked to comply with the SHC''s order of July 26, 2018 and not take any adverse action against K-Electric including issuance of any notification to implement the DRR until K-Electric''s appeal is adjudicated upon in accordance with law.
"Any such action taken in these circumstances shall constitute disobedience of SHC''s ad interim order. If such eventuality arises, K Electric reserves all rights to take actions to protect its interests," said KE in its letter. Hyder Ali Khan, the advocate for KE, contended in the court that KE is a public limited company and engaged in the business of generation, transmission and distribution of electricity in Karachi and its adjoining areas.
According to the counsel, Nepra on July 5, 2018 made a decision on the reconsideration request of KE under section 12 C of the Regulation of General, Transmission and Distribution of Electric Power Act, 1997 ( Act 1997) as amended through Regulation of General and Transmission and Distribution of Electric Power ( Amendment) Act, 2018 ( Act 2018), the right of appeal has been provided against DRR; however, KE is unable to exercise such right as the Power Division has not established/constituted appellate tribunal. The counsel further stated that KE''s right of appeal against DRR is of critical importance as the DMLR and the DRR have both been passed by Nepra and as such KE''s case has not been adjudicated through the DRR and will be detrimental to the interest of the company.
After hearing arguments of KE counsel, SHC has issued a stay order against the expected notification of tariff determined on reconsideration request of federal government. Meanwhile, KE has informed Pakistan Stock Exchange (PSE) that it has obtained a stay order against expected issuance of tariff notification by the federal government.