Provisional negative adjustment of FCA: Nepra urged to pass on benefit to KE consumers

ISLAMABAD: National Electric Power Regulatory Authority (Nepra) has been urged to pass on entire benefit of provisional negative adjustment of FCA of Rs 4.95 per unit to the K-Electric (KE) consumers for December 2024.

On Wednesday, Nepra concluded its hearing on K-Electric’s petition of provisional monthly fuel charge adjustments (FCA) for December 2024, as a relief of Rs 4.95 per unit.

Following a public hearing, the regulator will issue a decision clarifying the FCA amount to be passed on to customer bills and the period for which they will be applicable.

Fuel charge adjustments are incurred by utilities due to global variations in fuel prices used to generate electricity, and the changes in generation mix. These costs are reflected in customer bills following Nepra’s scrutiny and approval.

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Customers also benefit from negative FCA in their bills when global fuel prices decrease. Rates charged to customer bills are determined by Nepra and notified by the Federal Government.

KE has also highlighted the adjustments regarding part load, degradation curves, startup costs pursuant to determination of generation tariff of power plants of KE for the period post June 2023 and requested Nepra to consider the recovery of the same from negative fuel cost variation to ensure that consumers are not burdened at a later stage.

Tanveer Barry, a representative of Karachi Chamber of Commerce and Industry, said that KE claims regarding partial load, open cycle, startup cost are structural costs that should be addressed under quarterly adjustment not monthly FCA.

According to him, Nepra generation tariff decision of October22, 2024 clearly states that startup cost and others should be dealt separately and have no connection with generation tariff.

“Nepra must audit and validate KE claims through supporting documentation, invoices and efficiency report before any decision,” he said, adding that revenue- based load shedding by the power utility company is a grave violation of Nepra Act and Performance Standard, urging the Regulator to take strict action against KE.

Nepra, in its statement, stated that KE has sought negative adjustment of Rs 4.95 per unit in FCA for December 2024 whereas negative adjustment of Rs 1.23 per unit is already in place for November 2024.

The Regulator further clarified that the FCA for the month of December 2024 will be reduced by Rs 3.72 per unit.

As per the regulatory authority’s decision, the negative FCA shall be applicable to all the consumer categories except Electric Vehicle Charging Stations (EVCS), lifeline consumers, prepaid metering consumers, domestic consumers (Non-ToU) consuming upto 300 units and agricultural consumers.

Copyright Business Recorder, 2025