The latest reports say that National Electric Power Regulatory Authority (Nepra) has increased Rs4.45 per unit for consumers served by K-Electric (KE).
KARACHI: (UrduPoint/Pakistan Point News-Oct 7th, 2023) Karachi's residents are set to experience an uptick in their electricity bills as the National Electric Power Regulatory Authority (Nepra) increased Rs4.45 per unit for consumers served by K-Electric (KE).
This decision is a result of the initial quarterly adjustment from the preceding fiscal year, as disclosed in an official notification from the Power Division.
In addition, the extra funds gathered from KE's consumers will be allocated towards their bills for October and November of 2023, in accordance with the notification.
Furthermore, Nepra has granted approval for the inclusion of the actual or prudent expenses linked to the temporary operation of Unit-3 at the Bin Qasim Power Station (BQPS-I) from May 1 to August 15, 2021, following a request made by KE.
This adjustment has necessitated a modification of previous rulings issued by the Authority on September 15, 2021, and May 12, 2022.
In an additional statement, Mathar Niaz Rana, a member of the authority, expressed reservations regarding KE's inefficiencies.
Specifically, he raised concerns about the additional fuel expenses incurred due to KE's inability to meet the December 2019 deadline for having both phases of BQPS-III fully operational. He contended that these supplementary costs should not be transferred to consumers.
A pivotal public hearing took place on January 25, 2023, providing KE with an opportunity to present its case. During this hearing, the utility company explained its rationale for the temporary use of Unit-3 at BQPS-1 to meet Karachi's peak summer demand, as opposed to resorting to more costly power generation methods or implementing power outages. KE invoked sections 31(2) & 32(3) of the Nepra Act, asserting that this decision was made in the best interests of consumers.
Following meticulous deliberation, the authority determined that consumers should not bear the burden of KE's inefficiencies, which were evident in the delays surrounding the commissioning of BQPS-III and the interim utilization of the less efficient Unit-3 at BQPS-1. Consequently, the authority opted to cap the FFC (Fixed and Financial Cost) of the interim operation of Unit-3 at BQPS-1 at the level of BQPS-III.
It is worth noting that Nepra also took cognizance of the fact that KE had previously operated Unit-3 at BQPS-1 when the decision concerning the Licensee Proposed Modification (LPM) was issued in September 2021, and the company had been subjected to a fine of Rs200 million for prior issues. To prevent duplicative penalties, Nepra determined that KE should not incur additional charges.
Based on the judgment of the Appellate Tribunal and the submissions presented by KE, the Authority posits that, as per Section-31(3)(a) of the Nepra Act, a licensee should recoup reasonable costs to fulfill its requirements. In light of the public interest rationale for allowing the interim operation of Unit-3 at BQPS-I, the operational expenses are deemed reasonable and have been sanctioned by the Authority.
