Load-shedding based on AT&C losses: Nepra slaps Rs0.1m daily fine on HESCO
ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has imposed a daily fine of Rs 100,000 on the Hyderabad Electric Supply Company (HESCO) for continuing load shedding based on Aggregate Technical and Commercial (AT&C) losses, a practice not recognized under existing legal frameworks.
According to the Authority’s decision, during hearings in the matter of monthly Fuel Price Adjustments (FPAs) for DISCOs and K-Electric being held on monthly basis, number of complaints regarding unscheduled load shedding by general public had been and are being received by the Authority.
Upon inquiry, it was revealed that load shedding is being carried out on the basis of AT&C losses policy which is not in line with the provisions of the NEPRA Act, 1997, and Performance Standards (Distribution) Rules, 2005, and has never been recognized by Nepra.
Forced load-shedding: Nepra issues show-cause notice to KE
The authority further observed that the licensee is even violating its own so-called AT&C policy and carrying out excessive load shedding as compared to the scheduled one. Moreover, few feeders were randomly selected, and observed that the licensee has failed to make improvements in technical and financial health of those feeders since last four years despite allowing colossal amounts under O&M head by Nepra and continuing their operations in status quo, due to which, even good paying consumers are suffering.
Consequently, the Authority initiated legal proceedings against the Licensee. Upon conclusion of the proceedings, the Authority, through its Order dated April 03, 2024, imposed a fine of Rs. 50 million on the Licensee under the NEPRA Act and the NEPRA (Fine) Regulations, 2021, for violating Rule 4(f) of the Performance Standards (Distribution) Rules, 2005, read with Section 21(2)(b) & (f) of the NEPRA Act and Article 11 of the terms and conditions of its Distribution License.
The Disco submitted its response to the Authority but the latter did not agree with the Disco’s viewpoint.
The Authority, in its decision has held that in the light of the submissions made by the Licensee, the evidence available on record, and the applicable provisions of Nepra laws as well as the terms and conditions of the Distribution License issued to the Licensee, the Authority has rejected the response submitted by the Licensee against the Show Cause Notice of March 20, 2025.
Accordingly, the Authority has directed the Disco to immediately cease and refrain from continuing AT&C-based load shedding in contravention of the Authority’s directives and the applicable legal framework. Further, the Authority imposed a fine of Rs100,000 per day on the licencee for each day of persistent contravention with effect from the date of the Authority’s original Order of April 04, 2024, until the violation is rectified to the satisfaction of the Authority.
The fine is imposed under the provisions of the NEPRA Act and the NEPRA (Fine) Regulations, 2021, on account of violation of Rule 4(f) of the Performance Standards (Distribution) Rules, 2005, read with Section 21(2)(b) & (f) of the NEPRA Act, and Article 11 of the terms and conditions of the Distribution Licence.
Copyright Business Recorder, 2025