National Electric Power Regulatory Authority (Nepra) on Thursday allowed Rs 1.56 per unit increase in tariff for power Distribution Companies (Discos) for October 2019 under monthly fuel price adjustment formula, with several ifs and buts on the efficiency of power sector.
The decision was taken at a public hearing presided over by chairman Nepra Tauseef. H Farooqi Member Balochistan, Rematullah Baloch and Member Sindh Rafique Ahmed Shaikh accompanied the chairman.
The total financial impact of determined tariff by the Nepra's technical team will be Rs 14.5 billion to be passed on to the consumers in bills of December 2019. Of this, the financial impact of electricity generated from coal has been calculated at Rs 5 billion after Mangla power plant's turbines were on forced shut down for a few weeks due to the earthquake.
The chairman Nepra raised a number of questions on shutting down of Mangla power plant including possibility of fulfilling indents of province from Tarbela so that electricity could have been produced. However, he was informed that water releases from reservoirs are meant for provinces and electricity is a byproduct.
Central Power Purchasing Agency -Guaranteed (CPPA-G) in its tariff petition, had sought Rs 1.74 per unit increase in electricity prices to recover an amount of Rs 16 billion from the consumers in October.
Explaining the reasons for the decline in gas-fired electricity, General Manager NPCC, Muhammad Ayub stated that 300 MMFCD RLNG is required for power generation but only 180 MMCFD RLNG is being supplied. He said, due to reduced gas supply to the power sector, economic merit order is being honoured. He maintained that furnace-oil fired expensive power plants are being run due to shortage of gas.
"We have requested all the RLNG based power plants to become available but they expressed their inability due to non availability of RLNG," he added. The chairman Nepra argued that whatever energy was expended on improving power generation should also have been expended on upgrading the transmission network and then there would not have been such problems.
He said, KE was establishing imported coal and RLNG-fired power plants but NDTC was not ready to sign transmission agreement to evacuate the electricity.
"If a miracle was achieved by reducing load shedding to zero with substantial generation then why we didn't we also focus on evacuation of power," he questioned.
Member Sindh, Rafique Ahmed Shaikh stated that consumers' are being strangled everyway. He sough the reasons for not taking electricity from wind power projects in Sindh. General Manager, NPCC explained that the rate of electricity generation of wind power plants are on must run basis but their tariff ranges from Rs 25 to Rs 27 per unit which is very expensive. Member Sindh, said since the tariff of renewable energy has been massively reduced, why are not new plants being encouraged; and suggested that Nepra should hire an international consultant to conduct a study on how much financial loss has been inflicted on the national exchequer for the last five years for disallowing renewable energy in the country.
The chairman Nepra stated that consumers have installed solar panels of 980 MW and even two members of Nepra have gone on net metering and their bill is now zero.
He said, he was witnessing increase in power tariff since his joining Nepra as Chairman, asking when Nepra will recommend reduction in tariff. At this CFO CPPA-G, Mr Rehan said that this time will come after two months when reference price will be revised upward.
Member Sindh said that industry is already exiting Discos and now commercial and domestic consumers are being heavily burdened. He further stated that tariff may be raised to as high as Rs 50-60 per unit and people would be given a choice to either pay their bill or arrange food.
CPPA-G had previously sought an adjustment of Rs 3.5354 billion but the regulator allowed only Rs 1.953 billion.
The price variance in different fuels in October was recorded at Rs 5.787 billion of which Rs 363 million were on account of coal generation, Rs 3.5 billion gas, Rs 1.933 billion RLNG, Rs 6 million, Rs 44 million purchase of power from Iran. However, a reduction of Rs 44 million has been witnessed in mixed electricity prices and Rs 16 million in baggasse.
According to the data submitted by the CPPA-G, total energy generated in October 2019 recorded at 9,572Gwh at a total cost of Rs 48.013 billion. The basket per unit price of generated electricity was calculated at Rs 5.0159 per unit. However, CPPA-G has also sought previous adjustment/supplemental charges of Rs 3.535 billion or Rs 0.3667 per unit, Rs 439 million (Rs 0.0367 per unit) against supply of 16.51Gwh electricity to IPPs and transmission losses of 258.94Gwh at a price of rate of Rs 0.1490 per unit. Net delivered to Discos was recorded at 9,296.6Gwh at a total cost of Rs 51.109 billion. CPPA-G has calculated per unit cost of net delivered electricity at Rs 5.4976 per unit.
Hydel generation in October 2019 recorded at 2,438.8Gwh which was 25.48 percent of total generation, whereas generation from coal was 2,357Gwh, 24.62 percent of the total generation.
In October, the total cost of electricity generated from coal was Rs 13.790 billion, RFO-Rs 259 million, gas-Rs 8.419 billion, RLNG-Rs 24.045 billion, nuclear-Rs 895 million, import Iran-Rs 498 million, mixed-Rs 89 million and bagasse-Rs 18 million. However, generation from High Speed Diesel (HSD) was zero whereas 19.26Gwh of electricity was generated from furnace oil at a price of Rs 13.4435 per unit. Generation from natural gas was recorded at 1,165Gwh (12.17 percent in total generation) at a rate of Rs 7.271 per unit while RLNG-fired power generation was 2,432.7Gwh (25.41 per cent of total generation) at a rate of Rs 9.8837 per unit. Generation from nuclear sources was 883Gwh at a rate of Rs 1.0134 per unit, whereas mixed generation and wind was recorded at 13GWh (at Rs 6.8 per unit) and 153Gwh respectively.
CPPA-G, in its petition has claimed that on the basis of data, the price of net delivered electricity has been calculated at Rs 5.4976 per unit against reference price of Rs 3.7579 per unit and sought an increase of Rs 1.7397 per unit for October 2019.
After 45 minutes of question and answer session, Nepra officials said that actual fuel charge component in October 2019 was Rs 5.3235/ kWh against reference tariff of Rs 3.7579 /kWh and recommended an increase of Rs 1.54 per unit in tariff for October 2019.
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