ISLAMABAD: National Electric Power Regulatory Authority (Nepra) on Tuesday put off a public hearing of K-Electric's monthly fuel price and quarterly tariff adjustment petitions for increase in tariff on the plea that since government has decided not to increase tariff till June 30, 2020 , the KE petitions do not merit to be heard.
Chairman Nepra, Tauseef. H. Farooqi and Nepra's technical team were present at the auditorium of Nepra headquarters while two members - Saif Ullah Chattha and Rehmatullah Baloch - joined the proceedings via a video link. K-Electric's Chief Financial Officer, Aamir Ghaziani, who has reportedly tested Covid-19 positive, joined the hearing from Karachi. According to the KE, it has sought an increase of Re 0.657 per unit for January 2020, Re 0.975 per unit for February, Re 0.480 per unit for March under monthly fuel price adjustment. However, a reduction of Re 0.621 per unit has been proposed for April 2020. KE has also filed its requests for quarterly adjustments in tariffs on account of variations in Power Purchase Price (PPP)- other than fuel, impact of fuel charges variation, as per the mechanism provided in the Multi-Year Tariff determination. KE, in this regard, has requested Re 0.115 per unit reduction in tariff for October-December 2019 and Re 0.233 per unit increase for quarter January-March 2020.
Rehmatullah Baloch, who hails from Balochistan, told CFO, KE that "Rs 500 million is being released by the provincial government to KE today," indicating that he has played a role in this regard.
As the hearing began, Chairman Nepra asserted that since the government has decided not to increase tariff for power Distribution Companies (Discos) till June 30,2020, the regulator cannot allow KE to increase tariff.
Chairman Nepra inquired from the tariff team that whether tariff is being increased or reduced; he was told that tariff will increase.
"Since tariff is being increased, the cabinet's decision is that electricity prices will not be increased till June 30, 2020 and when we decided not to increase tariffs of Discos as per the government's decision then why are we holding hearing of KE's petition," he questioned.
The tariff team argued that KE has to file its quarterly and monthly adjustment requests. Upon which, Chairman Nepra said that whatever treatment will be given to rest of Pakistan will be given to KE, adding that Nepra should not have held this hearing.
"If KE's tariff would have been reduced then the case was different but its tariff will increase then that would imply disregarding cabinet's decision," he further argued.
When the Chairman sought the viewpoint of legal team of Nepra on the KE's petitions for adjustment of quarterly and monthly tariffs, Irfan Munawar Gill, said that there is no legal hitch in hearing the tariff petitions as subsidy is involved. However, Chairman stated that the regulator is also operating in Pakistan not outside the country, adding that if Discos' quarterly and monthly tariff requests have been entertained then KE should have also been allowed.
He also enquired the viewpoint of members. Saif Ullah Chatha said that legally Nepra should conduct hearing on the requests of KE and announce it after June 30, 2020. He cited the case of Discos, saying that when Pepco's letter was received in Nepra just before the hearing of Discos' tariff adjustment requests, in which cabinet's decision was conveyed, the Authority adjourned the hearing . He was of the view that if the government lifts ban on moratorium on tariff increase, Nepra would allow KE requests after June 30.
After hearing the arguments of Saif Ullah Chattha, Chairman Nepra decided that hearing will be conducted in the first week of July which is not for away. Rehmatullah Baloch also supported the viewpoint of Chattha.
However, when Chairman Nepra sought the viewpoint of KE, its CFO Aamir Ghaziani said that the public hearing should move forward as public notice and 40 days' hearing notice are involved. He was of the view that if the process is delayed after June 30, it will be further delayed because of a lengthy process. He further argued that hearing should be completed as every stakeholder is available while determination can be announced after June 30, 2020.
However, Chairman responded that the regulator had a similar option with respect to Discos' quarterly tariff petitions but it did what the government decided. He said that there is no bar of a 14-day notice, committing that the regulator will expedite the hearing process.
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