ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has increased the Discos’ tariff by Rs4.92 per unit for February 2024 under the monthly Fuel Charges Adjustment (FCA) mechanism.
The authority conducted the hearing in the matter on March 28, 2024, officiated by the entire authority headed by the chairman, Waseem Mukhtar.
The authority reviewed the request/information provided by the CPPA-G seeking monthly fuel cost adjustment (FCA) and due diligence is done accordingly. From perusal of the information so provided by CPPA-G, the actual pool fuel cost for the month of February 2024, as claimed by CPPA-G, is Rs9.4254/kWh, against the reference fuel cost component of Rs4.4337/kWh.
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The authority noted with concern that demand has been continuously declining and till February 2024, the overall demand has been reduced by around 12 per cent as compared to the reference projections assumed in tariff. This decrease in sales would consequently result in higher quarterly adjustments, leading to a further increase in the tariff.
The authority, therefore, directed the CPPA-G and the Ministry of Energy (MoE) to analyse the impact of lifting commercial-based load-shedding on the demand side and submit an intelligent proposal before the authority to improve the demand.
It was also highlighted that currently, over 60 per cent of the tariff consists of capacity charges, which is much higher as compared to international standards. The authority accordingly asked the CPPA-G to evaluate the possibilities of reducing capacity charges while remaining within the legal framework.
The authority further noted that wind-based power plants are being curtailed leading to NPMV and expensive imported fuel-based power plants are being operated.
It was also observed that Guddu Power Plant was operated on a 45 per cent plant factor on open cycle instead of combined cycle, had this plant been operated on combined cycle, it would have reduced the cost of generation.
The NTDC, while responding to the concerns raised by the commentators, submitted that operation of RLNG-based power plants was necessary to maintain system stability and non-operation of these plants may have led to national blackouts, thus, leading to additional cost to restart and normalise the system.
The revised FCA will be charged in the bills of April 2024.
Copyright Business Recorder, 2024
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