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ISLAMABAD: National Electric Power Regulatory Authority (NEPRA) has raised tariff of power Distribution Companies (Discos) by Rs 2.87 per unit for March 2022 and the tariff of K-Electric (KE) by Rs 1.3863 per unit for February 2022 under monthly Fuel Charges Adjustment (FCA) mechanism.

According to determination of DISCOS, CPPA-G requested positive FCA of Rs.3.1574/kWh, having an impact of Rs.32 billion.

The Authority conducted a hearing in the matter on April 27, 2022 which was attended by officials of concerned organisations.

NPCC/ NTDC during the hearing, explained operation of power plants on RFO; 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, 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.9 million. The Authority has decided to deduct this amount provisionally in the instant FCA, until NPCC/ NTDC and CPPA-G provided the required details along with complete justification in this regard are submitted to the satisfaction of the Authority.

Further, while reviewing the FCA claim, the Authority observed that Partial Load was provided to Balloki and QATPL power plants on HSD operations even during Forced Outages and Failure to Achieve Despatch (FADL), which is a non-performance/ fault of the said power producers. The Authority is of the considered view that Part Load can only be provided if the Plant is available but NPCC despatches it on part load due to system requirements. Similarly, Part Load cannot be provided in the case of failure of the plant to achieve the Despatch instructed by the NPCC. Therefore; an amount of Rs4.115 million (Rs 3.745 million for QATPL and Rs. 0.37 million for Balloki) for the month of January 2022 was deducted on account of Partial Load charges in FCA of March 2022.

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After verifying the data, the Authority has approved positive FCA of Rs.2.8680/kWh, having impact of around Rs.29 billion. The FCA of March 2022 shall be charged in the billing month of May 2022 to all consumer categories of Discos, except life line consumers. This FCA would remain applicable only for one month. This FCA is not applicable to KE consumers.

K-Electric FCA for February 2022: The Authority approved FCA of Rs 1.3863/ kWh for February having impact of Rs 1.586 billion against the request of Rs 3.452 kWh having impact of Rs 3.950 billion. The positive adjustment will be recovered in the bills of May 2022. The FCA shall be applicable to all the consumer categories except lifeline consumers.

During the hearing on April 4, 2022, regarding cost of energy purchased from CPPA-G during the month of February 2022, K-Electric used the rate of Rs. 12.4614/kWh; however, the Authority’s approved fuel cost component in the matter of Discos for the month of February 2022 was Rs. 9.1046/kWh. In view thereof, while working out the instant FCA of K-Electric the rate approved by the Authority for Discos for February 2022 has been incorporated for the energy purchased by K-Electric from CPPA-G during February 2022. This has resulted in decrease in total fuel cost by around Rs.2.315 billion.

The Authority carried out an in-house analysis of the data provided by K-Electric for the month of February 2022, to work out the financial impact due to deviation from EMO. The instances and events were shared with K-Electric for provision of clarification/ justifications, and K-Electric was asked for the reasons in this regard.

Regarding the financial impact due to underutilization of efficient plants on account of lower gas pressure, a letter was issued to KE on September 16, 2021, whereby, it was directed to resolve its gas pressure/ lower gas quantity issues within thirty days.

In response, KE has informed that it is in the process of resolving the lower gas pressure issue; however, there are certain meetings with stakeholders that will take place in due course of time. Subsequently, K-Electric has shared details of communication with SSGC and Ministry of Energy (Petroleum Division) regarding the finalization of GSA.

However, during the FCA meeting, K-Electric’s representatives submitted that the draft GSA between KE and SSGC does not guarantee the Gas Pressure or Quantity and the Gas/ RLNG will be available with KE on “As and When” available basis even after the GSA is signed.

Copyright Business Recorder, 2022

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