DISCOs request a price hike of Rs2.18.
It is estimated that the increase will result in increased costs for customers totaling Rs43 billion.
ISLAMABAD: On Tuesday, power distribution companies (Discos) requested a 2.18 rupee per unit rise in energy pricing to account for a quarterly adjustment for the fiscal year 2022–2023. The rise is anticipated to cost electricity users an additional Rs43 billion.
As a result of quarterly revisions, electricity consumers were already paying Rs3.30 per unit till January 2023. Unbelievably, consumers will also have to pay nearly Rs30 billion in capacity fees in only one quarter.
Discos requested approval of an increase in electricity rates on account of quarterly adjustments in the first quarter (July-September) of FY 2022-23 in order to recover Rs43.337 billion in revenue from electricity consumers during a public hearing held by the National Electric Power Regulatory Authority (Nepra).
Tauseef Farooqui, Nepra Chairman, presided over the open hearing. Rafiq Ahmed Sheikh and Maqsood Anwar Khan, two Nepra members, were also present.
Unfortunately, power plants that have been sitting idle and haven’t added a single unit to the national grid are being forced to accept astronomical payments from consumers.
These customers who have been paying their bills on time and honestly are to be reimbursed for this money. Despite the fact that due to inefficiencies and power theft by power distribution firms, circular debt has reached an all-time high.
Honest consumers who regularly pay their bills have been forced to face the expense of theft rather than making efforts to control power theft, increase efficiency, and improve the recovery of electricity bills. They have been paying several levies on their electricity bills, such as fees for debt servicing, financial costs, and tariff rationalization.
The electricity regulator stated that the Ministry of Power sought the adoption of quarterly changes in the months of February and March in order to avoid overtaxing consumers with rates.
Nepra added that for the fourth quarter adjustment of FY 2021–22, which is in place till January 2023, consumers will be charged Rs3.30 per unit.
Consumers will only be responsible for the prior adjustment in the event that quarterly adjustments are recovered during these two months, according to Nepra. All Disco users, with the exception of lifeline consumers, will be subject to this, according to the power regulator.
Customers of K-Electric (KE) will also not be affected, according to Nepra, who also noted that the body will release its comprehensive judgement following additional analysis of the data.
Officials from Nepra stated at the hearing that the planned increase would cost Rs. 2.18 per unit if approved.
The power distribution companies requested authorization from the regulator to use a quarterly tariff adjustment (QTA) mechanism to shift an additional burden of approximately Rs 43 billion to energy users for the first quarter (July-September) of FY 2022-23.
The Discos requested an increase for the first quarter of FY 2022–23 in their appeal to Nepra, citing a rise in capacity fees, transmission fees, market operating fees, the impact of transmission and distribution (T&D) losses on fuel cost adjustment (FCA), and maintenance fees (July to September 2022).
A positive adjustment of Rs2.704 billion was requested by IESCO, Rs9.101 billion by LESCO, Rs5.337 billion by GEPCO, Rs6.377 billion by FESCO, Rs10.688 billion by MEPCO, Rs2.129 billion by PESCO, Rs450 million by HESCO, Rs3.663 billion by QESCO, Rs905 million by SEPCO, and Rs1.282 billion by TESCO, according to the petition.
Discos have asked for Rs. 31 billion to cover capacity charges, Rs. 6.431 billion to cover UOSC and MOF, Rs. 2.169 billion to cover variable operation and maintenance (O&M), Rs. 7.408 billion to cover T&D losses in monthly FCA, and Rs. 4.248 billion to cover a negative adjustment for additional unit costs.
