The National Electric Power Regulatory Authority (NEPRA) has announced the decision to increase the power tariff by Rs. 5.94 per unit, which is historically the highest on account of the monthly Fuel Cost Adjustment (FCA).
As per the regulatory authority’s notification, the actual fuel charge component for January 2022 was determined at Rs. 12.46 per unit, while the reference price for the already-determined tariff is Rs. 6.51 per unit.
Therefore, as per the petition submitted by the Central Power Purchasing Agency (CPPA), NEPRA has allowed charging consumers an additional fuel cost of Rs. 5.94 per unit.
The CPPA had requested an increase in electricity prices by Rs. 6.10 per unit in terms of the monthly fuel adjustment for January 2022.
During the briefing regarding the generation data, it was announced that 33.15 percent of the total electricity in January was generated from coal and 5.83 percent through hydropower stations. Diesel stood at 6.73 percent, while furnace oil contributed 14.07 percent. Local gas was used to generate 14.37 percent of the electricity, and LNG contributed 7.12 percent. Nuclear fuel accounted for 14.37 percent of the total production, wind, 2.22 percent and bagasse 1.22 percent. The electricity imported from Iran accounted for 0.36 percent and solar power’s contribution was 0.53 percent.
The most expensive electricity generated this January was from high-speed diesel (HSD). The cost of the electricity produced using HSD was Rs. 25.98 per unit. This was followed by furnace oil at Rs. 22.80 per unit, LNG, Rs. 16.70, coal Rs. 14.10, local gas Rs. 7.74 per unit, nuclear Rs. 1.07 per unit, and bagasse Rs. 5.98 per unit.
During the hearing, NEPRA’s officials stated that the LNG shortage in January had an additional burden of Rs. 7.74 billion which had put an additional burden of 92 paisas per unit on consumers. They said that there would have been a further reduction of Rs. 1 in the tariff if licensed solar and wind power plants had been operating.
After the hearing, NEPRA approved an increase of Rs. 5.94 per unit in the price of electricity, which is the highest-ever as determined by FCA, and will result in an additional burden of Rs. 58 billion on electricity consumers. However, the increase is not applicable to the lifeline and K-Electric consumers.
