Power Division is to submit a report to the Economic Coordination Committee (ECC) on Net Hydel Profit (NHP) on Tuesday (today), official sources told Business Recorder. "An amount of Rs 43 billion of NHP has been made part of the tariff of which Rs 40 billion will go to the provinces in one year," the sources said, adding that the entire picture will be presented to the ECC to be presided over by Finance Minister, Asad Umar.
The Power Division will share a chart of released amount of NHP to the provinces with the ECC, as per the agreed formula. The ECC had deferred recovery of NHP from consumers but directed the Wapda to arrange Rs 146 billion from banks and payment to the provinces in two years, adding that recovery of NHP is at the rate of Rs 2.25 per unit.
The main reason for the increase in average tariff from Rs 11.50 per unit to Rs 15.50 per unit was payment of NHP amount to the provinces concerned. Wapda is sending its claims to CPPA-G for recovery of NHP which is not being passed on to the consumers.
The sources stated that the uniform tariff being reflective of economic and social policy of the federal government is based on the consolidated revenue requirement approved and determined by Nepra for Discos is inclusive of: (a) tariff differential subsidy and inter-distribution companies tariff rationalization and (b) deferral of NHP to the tune of Rs 146 billion was proposed which accordingly was approved by the ECC.
The deferred cost, however, has been bridged by way of commercial loans by Wapda for payment to the provinces. The deferred cost maybe considered by Nepra in the revenue requirement of the Discos for subsequent determinations so that the bridge loan of Wapda is duly discharged.