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ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has allowed the Power Division to replace effectiveness of increase in tariff of Discos of Rs 1.6236 per unit under QTA for 4th quarter of FY 2019-20 and 1st and 2nd quarter of FY 2020-21, with an increase of Rs 1.7183 per unit in second & 3 quarters of FY 2019-20 aimed at passing minimum impact to consumers.

This adjustment has been made through imposition of surcharge of up to Rs 1.25 per unit on domestic consumers using over 700 units and other categories of commercial and industrial consumers.

With this alteration, Nepra has notified an increase of Paisa 8 per unit for domestic consumers, using over 300 units monthly and Paisa 11 per unit for commercial consumers, to be effective from October 1, 2021.

The Authority determined quarterly adjustments of Discos for the 4th quarter of FY 2019-20 on February 10, 2021, with a uniform rate of Rs.0.8276/kWh. Similarly, for the 1st and 2nd quarters of FY 2020-21, the Authority, in its decision on May 6, 2021, determined a uniform rate of Rs.0.8966/kWh.

Ministry of Energy (Power Division), in its request of May 21, 2021 filed reconsideration request on both decisions of the Authority, requesting that these adjustments be made applicable from October, 2021, instead of date of notification, once the periodic adjustments already in field cease to be effective, and be notified as such after incorporating surcharges as proposed.

The Authority accepted the request that the effectiveness of the recommended periodic adjustments be made effective from October, 2021 i.e. after the lapse of the existing quarterly adjustments ie September 30, 2021, and remain applicable till September 30, 2022.

However, the consumer end tariff would only increase by around Rs.0.08/kWh except for A2(a), ie, commercial, which will increase by Rs.0.11/kWh with effect from September 30, 2021. This increase would not be applicable on life line and residential consumers having consumption up to 300 units.

For other categories of consumers, those who are paying Rs 2.89 per unit as quarterly tariff adjustments will have to pay Rs 2.97 per unit from October 1, 2021 after imposition of surcharge of Rs 1.25 per unit. Those consumers who have peak load requirement less than 5 kW will have to pay additional Paisa 11 per unit.

Nepra argues that deferment of quarterly adjustments would be made applicable from October 01, 2021 and is purely being done on the request of the Federal Government, therefore, any financial impact arising on account of delayed application of the determined quarterly adjustments, would not be allowed to be passed on to the consumers and would be borne by the federal government.

Regarding surcharges proposed by the Federal Government for various categories of consumers, it is to be clarified that Nepra has not levied any of such surcharges rather it is the Federal Government which has the statutory power to do the same. Under Section 31(8) inserted through Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Ordinance, 2021, the Federal Government has the power to levy surcharges and any such surcharge is to be considered as a cost to be included in the tariff determined by Nepra.

Copyright Business Recorder, 2021

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