Power tariff adjustment for 2QFY22: Rs36bn impact to be passed on to consumers?

  • Power distribution firms seek positive adjustment of Rs 41 billion
Updated 29 Apr, 2022

ISLAMABAD: National Electric Power Regulatory Authority (NEPRA) on Thursday agreed in principle to pass on financial impact of Rs 36 billion to the consumers of Discos for the second quarter (October –December) of FY 2021-22 under Quarterly Tariff Adjustment (QTA) mechanism.

The Authority comprising Chairman Tauseef H Farooqi, Vice Chairman Rafique Ahmad Shaikh and Member KP Anwar Maqsood Khan conducted the public hearing.

Initially, Discos had sought a positive adjustment of Rs 41 billion for the second quarter but later on almost all the companies revised their figures to Rs 36 billion. The revised figures of six Discos were displayed during the public hearing whereas revised figures of four companies were not available.

According to data shared with NEPRA, Islamabad Electric Supply Company (IESCO) has sought positive adjustment of Rs 4.404 billion for the second quarter. Lahore Electric Supply Company (LESCO) Rs 11.599 billion, Gujranwala Electric Power Company (GEPCO) Rs 3.689 billion, Faisalabad Electric Supply Company (FESCO) Rs 5.356 billion, Peshawar Electric Supply Company(PESCO) Rs 1.735 billion and Tribal Electric Supply Company (TESCO) Rs 1.237 billion.

Nepra allows Discos to raise tariffs for March

Multan Electric Power Company (MEPCO) sought positive adjustment of Rs 6.523 billion, Hyderabad Electric Supply Company (HESCO) Rs 2.763 billion, Quetta Electric Supply Company (QESCO) Rs 223 million and Sukkur Electric Supply Company (SEPCO) negative adjustment of Rs 808 million. However, these four Discos have submitted their revised figures.

During the hearing, none of the officials had figures of electricity as indicative demand from power plants during the quarter, and quantity of electricity received by the Discos against the booking. These figures were necessary to find out how much electricity Discos did not get or provide and its impact is being passed on to the consumers as capacity charges.

Chief Financial Officers (CFOs) of LESCO and HESCO were not fully prepared with accurate figures to respond to the questions raised by the Authority.

A representative of Central Power Purchasing Agency- Guaranteed (CPPA-G) stated that Rs 22 billion are related to K-2 and Rs 16 billion to high-voltage, direct current (HVDC) transmission line.

It was also revealed that up to Rs 70 billion of Discos losses over and above the allowed losses, have become part of circular debt.

Copyright Business Recorder, 2022

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