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ISLAMABAD: National Electric Power Regulatory Authority (NEPRA) has directed K-Electric (KE) to refund Rs 7.40 billion @ Rs 4.12 per unit to its consumers for July 2022 under monthly Fuel Charges Component (FCA) mechanism.

The relief to be applicable on all categories of consumers except lifeline consumers, domestic consumers consuming up to 300 units, agricultural consumers and Electric Vehicle Charging Station (EVCS) consumers. The relief will be passed on to the consumers in their bills of September 2022. According to NEPRA, the Authority has decided to allow negative FCA of Rs 4.12 per unit for July 2022, to be passed on to the consumers in their monthly bills of September 2022. KE had sought negative adjustment of Rs 3.46 per unit to pass on benefit of Rs 6.247 billion to the consumers.

The negative adjustment in FCA shall be shown separately in the consumers’ bills on the basis of units billed to the consumers in the respective month to which the adjustment pertains. K-Electric shall reflect the fuel charges adjustment in respect of July 2022, in the billing month of September 2022.

The decision has been taken on the basis of facts presented at a public hearing held on August 31, 2022 for the month of July.

According to the determination, the Authority carried out an in-house analysis of the data provided by K-Electric to work out the financial impact due to deviation from economic merit order (EMO).

KE consumers: PD suggests Rs1.52 per unit surcharge

The Authority noted that KE operated Unit 1 of BQPS-I at minimum loading of 100 MW instead of 90 MW due to forced outage of its High Pressure Heater. KE was supposed to repair the damaged high pressure heater when it got damaged in 2019. However, KE did not make any effort to replace the part after 2019, which should have been carried out within the O&M cost allowed to KE under the MYT. The Authority further noted that in case BQPS-III would have been commissioned as per the schedule, operation of BQPS-I unit would have been minimized and this financial impact could have been avoided. In view of the above, an amount of Rs20 million is being deducted from the claim of K-Electric’s FCA for the month of July 2022.

Regarding previous adjustment of Rs.845 million claimed by K-Electric, withheld previously by the Authority on account of not following of EMO, the Authority observed that K-Electric has submitted certain information/ data in this regard, which is under consideration of the Authority. Therefore, for the purpose of instant adjustment the amount of Rs.845 million is not being considered as part of previous adjustment and will be considered once the Authority completes its final working in the matter.

According to NEPRA’s announcement, the impact of FCA for the month of June 2022 of Rs 11.10 per unit will also be done away with, in addition to negative adjustment of Rs 4.12 per unit for July, the overall impact on bills will be reduced by Rs 15.22 per unit in September 2022.

Copyright Business Recorder, 2022

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