Due to quarterly adjustments for the first quarter of 2023-24, K-Electric customers will face an additional increase of Rs 1.70 per unit in electricity tariffs, NEPRA.
NEPRA To Put Additional Burden on XWDiscos and K-Electric Consumers
Furthermore, on November 14, the National Electric Power Regulatory Authority (NEPRA) hold a public hearing to review the quarterly adjustments for both Ex-WAPDA distribution companies (XWDiscos) and K-Electric for the first quarter of 2023-24.
Following the Federal Government’s policy guidelines, which require the application of uniform quarterly adjustments, the regulatory authority stated that the adjustments determined for XWDiscos would also be applicable to K-Electric customers.
However, NEPRA initially issued a hearing notice to XWDiscos but later included K-Electric in the process via an addendum.
Rs. 22.9 Billion Extra Burden
Furthermore, tariff increases have been recommended by DISCOs for the first quarter of the current fiscal year. This increase is expected to cost Rs. 22.9 billion.
However, the additional dues will be collected between December and February, resulting in a Rs. 1.25 per unit increase in electricity costs.
XWDiscos requested permission to collect Rs 12.126 billion in capacity charges from its clients as part of the total additional amount.
This amount is given to Independent Power Producers (IPPs) to cover the cost of electricity that is not injected into national demand due to system constraints or low electricity requirements.
Consumers will also be responsible for Rs 4.617 billion in variable O&M costs, Rs 6.617 billion in T&D losses on monthly FCA, and Rs 10.247 billion in system charges and market operator fees.
Notably, according to the authority’s decision on the Winter Incentive Package on November 3, 2021, “no quarterly adjustments would be applicable on incremental consumption.”
The impact of incremental units has been calculated to be a negative Rs 11.047 billion for the quarter, representing the cost of units purchased for industrial incremental sales.
If the Rs 22.56 billion increase request is approved, it will cost XWDiscos customers Rs 1.70 per unit.
This effect will be passed on to K-Electric customers. Except for those classified as lifeline users, the increase will apply to all electric consumers in Pakistan.
To read our blog on “Discos to collect Rs. 30 bn extra from electricity consumers,” click here.