Power Division moves NEPRA for approval: Extra charges on wheeling consumers likely

ISLAMABAD: The Power Division has formally approached National Electric Power Regulatory Authority (NEPRA) for approval to impose additional charges on wheeling consumers under a uniform grid charges mechanism, to be implemented nationwide as Use of System Charges (UoSC), including for K-Electric.

NEPRA has scheduled a public hearing on June 11, 2026, to deliberate on the federal government’s motion, along with proposed policy guidelines aimed at standardizing the UoSC regime across the country.

According to the regulator, the motion stems from its earlier determinations issued on December 18, 2025, concerning UoSC for ex-WAPDA distribution companies (DISCOs).

The government now intends to extend a uniform framework for grid charges applicable to all bulk power consumers (BPCs) and open access users, including K-Electric, in line with the National Electricity Policy, National Electricity Plan, and Electric Power Supplier Licences Rules, 2023.

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Under the proposal, additional charges will be introduced to recover costs incurred by DISCOs and power suppliers. These costs may be incorporated as prior year adjustments (PYA) in future tariff determinations to bridge financial gaps arising from the uniform application of wheeling charges. The charges would be imposed uniformly on all relevant consumers.

The proposed UoSC rates are Rs 6.69 per unit for B-4, Rs 18.29 per unit for C-3, Rs 8.51 per unit for B-3, Rs 12.63 per unit for C-2(a), Rs 18.20 per unit for C-2(b), Rs 25.01 per unit for A-2(c), Rs 15.22 per unit for A-3, and Rs 5.30 per unit for D-1(b).

Additionally, the Power Division has proposed amendments to Section 88 (SD-88), subject to approval by the Economic Coordination Committee (ECC), to establish a comprehensive framework for addressing inter-DISCO differentials resulting from uniform open access charges. Although included in an ECC summary, the amendment was omitted from the final decision, prompting the Division to seek rectification of the ECC’s May 5, 2026 decision.

The Division maintained that the proposed amendment would provide the necessary policy foundation for implementing uniform UoSC across all distribution territories. Approval of this modification is expected to be submitted to NEPRA prior to the regulator’s final determination.

Highlighting urgency, the Power Division noted that the Commercial Market Operations Date (CMOD) was declared on January 22, 2026, while the first market auction is scheduled for June 2026. It emphasized that the operationalization of market liberalization reforms under the Competitive Trading Bilateral Contract Market (CTBCM) cannot be delayed, necessitating early determination of uniform UoSC and system losses in accordance with the approved Market Commercial Code.

The federal government has also decided that UoSC determined for eleven DISCOs should be extended to K-Electric. It further argued that any financial gap arising from uniform wheeling charges should be addressed through regulator-approved additional charges rather than subsidies, ensuring a level playing field in market transactions.

The Power Division has requested NEPRA to approve the proposed additional charges, which would be treated as legitimate costs of DISCOs and electric suppliers, recoverable through periodic tariff adjustments and applicable uniformly to all wheeling consumers.

Copyright Business Recorder, 2026