ISLAMABAD: National Electric Power Regulatory Authority (Nepra) on Wednesday once again urged K-Electric (KE) to start negotiations on out of court settlement dispute on clawback of Rs 47 billion, supposed to be refunded to consumers.
This issue came under discussion at a public hearing held in Nepra on KE’s requests in positive adjustments in Fuel Charges Component (FCA) for April 2023 and Quarterly Tariff Adjustment (QTA) of third quarter (Jan-March) 2022-23. The Authority approved negative adjustment of Paisa 5 per unit in KE’s FCA for April and positive adjustment of Rs Rs5.170 per unit in QTA, total impact of which will be Rs 20 billion.
The hearing was officiated by the Nepra Authority comprising of Chairman NEPRA, Tauseef H Farooqi, Member (Licencing), Engr Maqsood Anwar Khan, Member (Technical & Finance), Mathar Niaz Rana and Member (Law), and Amina Ahmed. The hearing was also attended by large number of representatives and senior officials of K-Electric, NTDC/ NPCC, business community, journalists and general public.
During the hearing when Chief Financial Officer (CFO), KE, Aamir Ghaziani was reminded that he had made a public statement on May 3, 2023 that the power utility company is ready to negotiate an out of court settlement of dispute on clawback which is under litigation in Sindh High Court (SHC) but that there was no progress on the part of the company.
Responding to the question of Chairman NEPRA, CFO KE again made a commitment to sit with the regulator very soon to sort this issue out, adding that as the Authority will allocate time he is ready to sit with them.
Chairman Nepra stated that no meeting had been held so far on this issue, adding that whenever KE is ready, Nepra will present itself as it is a most critical issue.
The issue of underutilization of first unit BQS-III which has already achieved its Commercial Operation Date (COD) was raised by Arif Bilwani, a businessman from Karachi. KE team did not satisfy the Authority, which directed the power utility company to submit its reply in writing. Nepra’s Tariff team apprised that the average cost of KE’s own generation was Rs 23.03 per unit in April whereas price of imported electricity including national grid was Rs 10.47 per unit.
Discos FCA April 2023: The Authority also agreed in principle to allow positive adjustment of Rs 1.61 per unit for April, total impact of which will be Rs 15.6 billion. However, the figure can be readjusted if NPCC gives some justification of over use of RLNG which was expensive as compared to local coal. CPPA-G had sought positive adjustment of Rs 2.010 per unit as Nepra’s teams proposed deduction of Rs 0.0167 per unit on account of adjustment in tariffs, Rs 0.3824 per unit (total impact Rs 3.7 billion) and Rs 0.0033 per unit adjustment by technical section.
Chief Executive Officer (CEO) Central Power Purchasing Agency-Guaranteed (CPPA-G) informed the Authority that fluctuation in use of RLNG is a routine matter as consumption of fuel is adjusted as per requirements. He further explained that generation was 23 per cent less in April 2023 as compared to corresponding month of previous year. He said 4 billion less units were generated in April. In reply to a question, Chairman Nepra stated that privatisation of Discos is beneficial for all segments as it will improve the system.
Copyright Business Recorder, 2023