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Coronavirus
VERY HIGH Source: covid.gov.pk
Pakistan Deaths
27,004
6624hr
Pakistan Cases
1,215,821
3,01224hr
5.3% positivity
Sindh
447,678
Punjab
418,196
Balochistan
32,671
Islamabad
103,549
KPK
169,972

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has approved a refund of Rs 3.3 billion to the consumers of Discos for May 2021 under monthly fuel component adjustment mechanism.

The Central Power Purchasing Agency- Guaranteed (CPPA-G) requested negative FCA of (Rs.0.1255/kWh), having impact of Rs.1.5 billion.

However, during the hearing on June 29, 2021, the Authority approved negative FCA (Rs.0.2644/kWh), having benefit of Rs.3.3 billion for consumers. The FCA of May 2021shall be charged in the billing month of July 2021 to all consumer categories of Discos, except life line consumers i.e. having consumption up-to 50 units, domestic consumers consuming up-to 300 units and Agriculture Consumers of all the Discos.

The Nepra has clarified that negative adjustment on account of monthly FCA is also applicable to the domestic consumers having Time of Use (ToU) meters irrespective of their consumption level .Further industrial consumers availing ISP will not get the benefit of negative FCA on incremental sales only. They will however, get the benefit of negative FCA on base tariff billed units. This FCA would remain applicable only for one month. This FCA is not applicable to KE consumers.

During the hearing, the Authority also observed that, prima facie, certain efficient power plants were not fully utilized and instead energy from costlier RFO/HSD based power plants was generated to the tune of over Rs.11.502 billion during the month of May 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 Authority also directed CPPA-G/NPCC/NTDC in the monthly FCA of February 2021, as follows: (i) System Operator shall report to CPPA-G, within 24hours, dispatch of generation plant(s) out of merit order along with reasons thereof. The copy of the report shall be sent to Nepra simultaneously;(ii) CPPA-G shall scrutinize the dispatch report in terms of Scheduling and Dispatch Code (SDC) of Grid Code and prepare a report which shall comprise of all dispatch deviation from merit order, plants available but not dispatched and dispatch deviation justified or unjustified in terms of SDC of Grid Code along-with their financial impact.

The CPPA-G shall share the report with the system operator and also submit it to Nepra at the time of filing of monthly fuel twice adjustment request.

The Authority observed that the required data/information was submitted by CPPA-G along-with the monthly FCA data of May 2021, however, it was not as per the requirements of the Authority. Accordingly, CPPA-G was directed to submit the report as per the desired format for consideration of the Authority.

The NPCC/NTDC during the hearing, explained operation of power plants on RFO/HSD, however, the Authority observed that an in-house analysis has also been carried out to work out the financial impact due to deviation from EMO based on the information submitted by NPCC. As per the in-house analysis/ workings carried out, the net amount deductible, on provisional basis, from the overall claim due to deviation from EMO due to underutilization of efficient power plants works out as Rs.354.29 million. The Authority has decided to deduct this amount provisionally in the instant FCA, until NPCC/ NTDC and CPPA-G provide the required details along-with complete justification in this regard to the satisfaction of the Authority.

The Authority has calculated the fuel cost for the month of May 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. However, the amount arising due to application of PPA factors, for the six RFO based IPPs, incorporated under 2002 Power Policy, has been allowed on provisional basis and shall be subject to adjustment, based on the final outcome of the ongoing suo motu proceedings against RFO based IPPs.

Copyright Business Recorder, 2021

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