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ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has increased power Distribution Companies (Discos) tariff by paisa 90 per unit for January 2021 under monthly fuel price adjustment formula to be reflected in bills of March 2021.

The taxes and surcharge already applicable will be in addition to the Nepra’s approved increase and will be recovered from all categories of consumers except lifeline consumers, which, according to Member National Assembly, Saif ur-Rehman, are those who use hand fans. The KE consumers are also exempted from this raise as their tariff is also being increased within a few days.

CPPA-G, in its request had sought an increase of Paisa 93 per unit, having impact of Rs 7.1 billion. However, the Authority slashed the impact to Rs 6.9 billion which is Paisa 89.54 per unit.

The Authority has gone through the information provided by CPPA-G seeking monthly fuel adjustment and due diligence done accordingly. From perusal of the information provided by CPPA-G, the actual pool fuel cost for January 2021 was Rs6.6846/kWh, against the reference fuel cost component of Rs5.7576/kWh .The actual fuel charges, as reported by CPPA-G for January 2021 increased by Rs0.9270/kWh as compared to the reference fuel charges.

The Authority from the data provided by CPPA-G, observed that fuel cost of M/s Hubco, M/s Liberty Power and M/s Orient HSD, has not been claimed by CPPA-G as per the Authority’s approved rates; accordingly the claim has been adjusted downward by Rs 33,361,015 in line with the Authority's approved rates for the month of January 2021.

Similarly, CPPA-G also claimed an amount of Rs 3.311 billion on account of previous adjustments for the month of January 2021 for six power projects i.e. Nandipur, Kapco, Hub Power, Rousch, Engro Energy, Haveli Bahadar Shah, and Balloki. However, the Authority verified it as Rs3.1 billion, which has been included in the monthly FCAs of January 2021.

As per the data submitted by CPPA-G, XWDISCOs purchased 1.06 GWI-I from Captive Power Plants (CPPs) during January 2021, for which CPPA-G provided actual details of energy purchased from these plants. According to the details provided by CPPA-G, the actual fuel cost of this energy is Rs5.3686 million. However, the same as per the Nepra-approved mechanism works out as Rs5.3685 million and was considered while working out the FCA of January 2021.

The Authority also during the hearing observed that, prima facie, certain efficient power plants were not fully utilised and instead energy from costlier RFO/HSD based power plants was generated to the tune of over Rs12,900 million during the month of January 2021. The Authority has been directing NPCC/NTDC & CPPA-G repeatedly to provide complete justification in this regard, to the satisfaction of the Authority and submit complete details for deviation from Economic Merit Order (EMO), showing hourly generation along-with the financial impact for deviation from EMO, if any, and the reasons, thereof.

The Ministry of Planning, Development and Special Initiatives submitted that the government has put a ban on utilisation of RFO & HSD for power generation, however, still 1,020 GWh have been generated on RFO/FISD. In contrast only 916 GWh were generated from RLNG, for which CPPA-G may be asked to explain the reasons for not utilising the full capacities of RLNG plants. In case of any transmission bottlenecks, an investment plan should be presented to remove any transmission constraints.

Accordingly, the Authority has calculated the fuel cost for the month of January 2021, after accounting for the adjustments, and including costs arising due to application of various factors, as provided in the respective PPAs of the power producers and claimed by CPPA-G in its FCA request.

The Authority noted that the amount arising due to application of PPA factors, for the six RFO based IPPs, incorporated under 2002 Power Policy, is being allowed on provisional basis and shall be subject to adjustment based on the final outcome of the ongoing suo moto proceedings against RFO based IPPs.

NTDCL, reported T&T losses of 329.51 GWh i.e. 3.54 percent based on energy delivered on NTDCL system during January 2021. The same has however been verified as 3.52 percent, therefore, for working out FCA of January 2021, losses of 327.60 GWh have been considered.

The Authority, after incorporating the adjustments, has reviewed and assessed an increase of Rs0.8954/kWh in the applicable tariff for Discos on account of variations in the fuel charges for the month of January 2021.

Copyright Business Recorder, 2021

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