Another Price Hike for KE Consumers on the Cards

K-Electric (KE) has requested the National Electric Power Regulatory Authority (NEPRA) for a Rs. 4.86 per unit increase under the monthly fuel cost adjustment (FCA).

This FCA petition is for the month of April and the consumers will be charged in July. If the monthly FCA is approved as per KE’s petition, the Karachiites will have to pay an additional Rs. 9.35 billion.

NEPRA will also consider an increase in KE’s tariff by Rs. 4.52 per unit for the first-quarter ending in March.

NEPRA will hear both the petitions on June 14 and will ascertain whether the KE has observed the merit order while dispatching to its power plants and power purchases from external resources. It will also see if the monthly fuel adjustment and quarterly tariff adjustment requests are justified by cross-examining KE’s data.

NEPRA had announced a Multi-Year Tariff (MYT) in 2019, which prescribed a mechanism for change in the MYT on a monthly and quarterly basis.

The request has come at a time when the entire country, including Karachi, is experiencing prolonged power outages due to a reportedly acute shortage of fuel, particularly gas, to K-Electric.

According to KE’s Director Communications Imran Rana, the supply of indigenous cheaper gas to K-Electric remains zero since the beginning of this year, while RLNG’s cost remains above Rs. 4500 per mmbtu versus last year’s Rs. 1500 per mmbtu around the same period.

Furthermore, the supply of imported gas has been reduced to less than 100 mmcfd which K-Electric used to get over 190 mmcfd last year. And there are reports that in Karachi, the duration of load shedding has even reached 12 hours in various low recovery locations.

KE recently wrote a letter to the Chief Minister Sindh Syed Murad Ali Shah where it pleaded for the immediate resolution of KE’s Tariff Differential Subsidies (TDS) Claims which have ballooned to a critical point.

KE said in its letter that even after adjusting its payments to the National Transmission and Dispatch Company (NTDC) and the Central Power Purchasing Agency (CPPA), its net receivables due to TDS Claims stand at Rs. 25 billion.

Source: Pro Pakistani