ISLAMABAD: Ministry of Water Resources has refused to pay Water Usage Charges (WUC) to Government of Azad Jammu and Kashmir (GoAJ&K) till its recovery through tariff begins, as decision on tariff petition is still pending with National Electric Power Regulatory Authority (Nepra), well informed sources told Business Recorder.

Ministry of Water Resources, in a letter to concerned authorities gave a reference to letters of Water and Power Development Authority (Wapda) of February 17 2023 and Finance Division of February 8, 2023 on which minutes of the meeting of January 30, 2023 chaired by the SAPM on Finance and Revenue were circulated. Para 4(b) of the minutes of meeting is as follows: “Water Usage Charges be paid to GoAJ&K on priority; Wapda to settle the matter of WUC for Mangla Hydropower project within 15 days. Wapda shall contact Secretary Power Division in case of any difficulty in the matter.”

Govt to revise power tariff mechanism for AJ&K

Chief Secretary and Secretary Energy AJ&K had briefed the meeting on fiscal challenges, including outstanding settlement with Wapda on Net Hydel Profit (NHP)/WUC.

After discussion with stakeholders following decisions were taken: (i) Power Division to submit a request to FBR for treating electricity supply to AJ&K by the ex-Wapda Discos as zero-rated; (ii) WUC be paid to GoAJ&K on priority; Wapda to settle the matter of WUCs for Mangla Hydropower project within 15 days. Wapda shall contact Secretary Power Division in case of any difficulty in the matter; (iii) Power Division to initiate process for revision of tariff mechanism through introduction of a separate category for AJ&K on bulk consumption or Discos’ rates.

Power Division and GoAJ&K have been directed to workout actual consumption of different categories of domestic consumers, as well as, the subsidy amount on actual basis for consumers of GoAJ&K.

Wapda, in a letter has informed that Nepra’s decision on its hydroelectric modification petition for FY 2022-23 which was filed on May 14, 2022, is still pending, which implies that in line with the ECC’s decision of March 20, 2019, WUC cannot be paid to GoAJ&K till recovery through tariff begins.

Ministry of Water Resources has requested Power Division to approach Nepra for an early decision in the matter, enabling Wapda to start payments of WUC to the GoAJ&K. Power Division has opposed supply of electricity to AJ&K as bulk consumer.

The sources said, during a meeting in Finance Division on January 30, 2023, Wapda had informed that in the light of ECC decision of March 20, 2019 amendment in Mangla Dam Raising Agreement of 2003 has already been signed and subsequently notified under Memorandum of February 28, 2022 by the Ministry of Water Resources. Accordingly, in its tariff modification petition for FY 2022-23 filed on May 14, 2022 which is under process in Nepra, Wapda had requested to allow payment of WUC to AJ&K on the generation of Mangla Hydropower Station @ TRs 1.10 per unit at par with the regular NHP rate for the provinces.

Copyright Business Recorder, 2023