FCA for October: CPPA-G seeks Rs4.75/u hike for Discos

ISLAMABAD: The Central Power Purchasing Agency-Guaranteed (CPPA-G) has sought an increase of Rs 4.75 per unit in tariffs of power Distribution Companies (Discos) for October 2021, the highest ever raise under monthly Fuel Component Adjustment (FCA) mechanism.

The key reason for the proposed increase in FCA was less generation from hydel and higher generation from expensive fuels due to short supply of RLNG and higher price of LNG and furnace oil in the international market.

The impact of proposed increase will be passed on all categories of consumers of Discos except lifeline consumers. It will also affect KE consumers to the extent of 1100-1300 MW being purchased from the national grid. Additionally, KE has also sought an increase of Paisa 29 per unit across the board for October under FCA mechanism.

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CPPA-G, an arm of Power Division, in its petition to National Electric Power Regulator Authority (NEPRA) mentioned the reasons for the proposed increase in tariffs of Discos under FCA.

The regulator will hold a public hearing on November 30, 2021 to seek justification from the officials of CPPA-G, NTDC and other relevant organization on the proposed raise. The hearing on KE’s request will be held on December 2, 2021.

According to the data submitted to Nepra in October 2021, hydel generation recorded at 2,627.25 GWh which constituted 23.26 per cent of total generation in the entire month. Power generation from coal-fired power plants was 1,885.78 GWh (16.69 per cent of total generation) at a rate of Rs 11.3666 per unit. Generation from HSD was recorded at 57.10 GWh (0.51 per cent) at Rs 25.2250 per unit. Generation from RFO was 1,228.66 GWh (10.88per cent of total generation) at Rs 21.2273 per unit.

Electricity generation from gas-based power plants was 1,092.75 GWh (9.67 per cent) at Rs 7.9795 per unit.

Generation from RLNG was 2,703.38 GWh (23.93 per cent of total generation) at Rs 16.7482 per unit as compared to Rs14.9104 per unit in September.

Electricity generation from nuclear sources was 1,392.92 GWh at Rs 1.0176 per unit (12.33 per cent of total generation), and electricity imported from Iran was 41.41 GWh at Rs 14.3398 per unit.

Power generation from different sources (mixed) was 11.87 GWh at a price of Rs4.4942 per unit, generation from baggasse recorded at 7.14 GWh at Rs 5.9816 per unit.

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The energy generated from wind was recorded at 184.82 GWh, 1.64 er cent of total generation and solar at 60.75 Wh, 0.43 per cent of total generation in October 2021.

The total energy generated recorded at 11,296.23 GWh, at a basket price of Rs9.3004 per unit. The total cost of energy was Rs105.060 billion.

CPPA-G also sought previous adjustment/supplemental charges of over Rs 5.171 billion. The sale to IPPs was also reduced by 47.17 GWh, the price of which was Rs 1.214 billion (Paisa 25.7427 per unit) while the reduction in transmission losses was recorded at 266.20 GWh, at a cost of Paisa 0.2349 per unit.

According to the CCPA-G data, net electricity delivered to Discos in October 2021 was 10,982.86 GWh at a rate of Rs9.9261 per unit, total price of which was Rs 109.017 billion.

CPPA-G in its tariff petition maintains that since the reference fuel charges for October 2021 were estimated at Rs 5.1733 per unit whereas the actual fuel charges were Rs 9.9261per unit including supplemental charges of Rs 5.171 billion, hence an increase of Rs 4.7528 per unit has been sought for October under FCA mechanism.

The Federal Cabinet has already increased base tariff by Rs1.39 per unit at the national level effective from November 1, 2021.

For September, 2021 Nepra had allowed an increase of Rs2.53 per unit under FCA mechanism.

Copyright Business Recorder, 2021