ISLAMABAD: Karachi residents will see a rise in their electricity bills for October and November following the National Electric Power Regulatory Authority’s (Nepra) approval of K-Electric’s request to levy additional charges during these months.
K-Electric sought permission from Nepra to collect an extra Rs2.5934 per unit in October and Rs3.1688 per unit in November, attributing this increase to fuel charge adjustments for May and June 2024. The cumulative impact of these adjustments amounts to Rs5.763 per unit, translating to an additional financial burden of nearly Rs10.6 billion on consumers.
When factoring in the general sales tax (GST), this total could climb to approximately Rs12.5 billion.
During the approval hearing, Karachi-based industrialists, politicians, and power consumers expressed strong criticism of Nepra, accusing the regulator of acting merely as a “rubber stamp” for the government and K-Electric. They argued that Nepra routinely approves such requests without adequately considering the public’s interest.
In its ruling, the Authority pointed out that K-Electric had initially used a fuel cost component of Rs8.9623/unit for energy sourced from the Central Power Purchasing Agency (CPPA-G) in May 2024, and Rs9.1190/unit for June 2024, based on previous approvals. The approved costs were Rs9.1190/unit for May and Rs9.7545/unit for June 2024, resulting in positive adjustments of Rs118.76 million for May and Rs459.32 million for June.
For generation at the Korangi Combined Cycle Power Plant (KCCP) using High-Speed Diesel (HSD), K-Electric initially used a fuel price of Rs7,333.04/MMBtu for June 2024 but later revised it to Rs7,179.86/MMBtu.
Industry bodies such as KATI and BQATI urged for a provisional Fuel Cost Adjustment (FCA) charge of Rs1/unit for May and June 2024 due to the current economic challenges and high inflation. They suggested that further adjustments be made during winter, when electricity consumption is typically lower.
Imran Shahid from Jamat-e-Islami opposed the FCA request, arguing that it was not in the best interest of consumers. Meanwhile, Arif Bilwani questioned why K-Electric used KCCP on HSD instead of the cheaper Bin Qasim Power Station-I (BQPS-I) running on Residual Fuel Oil (RFO).
K-Electric defended its decisions, stating that the dispatch was based on merit order and load demand. Bilwani also proposed replacing K-Electric’s own generation with power from the National Transmission and Dispatch Company (NTDC) to reduce costs. However, the Authority clarified that increasing the supply of electricity from the National Grid to K-Electric is a policy decision.
