Electricity prices likely to rise by Rs1.74 per unit

The National Electric Power Regulatory Authority (Nepra) held a public hearing on the Central Power Purchasing Agency’s (CPPA) request for an additional fuel cost recovery of Rs1.73 per unit from consumers for the June billing month. CPPA Chief Executive Officer Rehan Akhtar told the hearing that the reference fuel cost for April had been set at Rs8.25 per unit, but the actual cost turned out to be Rs9.975 per unit, mainly because of the US-Iran war and the resultant disruption in LNG supplies, thus necessitating an additional charge of Rs1.73 per unit on consumers in the billing month of June. Technical constraints in shifting cheaper power sources in Sindh to load centres in the upcountry regions facing shortages also contributed to the higher fuel cost adjustment (FCA). The net increase would be Rs1.74 per unit, as an existing minor negative fuel adjustment had also come to an end. The CPPA official said the government decided to undertake load management and limit the use of furnace oil and diesel for power generation, which helped contain the additional FCA at Rs1.73 per unit. He said special arrangements were made for LNG imports and the government decided to charge Rs2,000 per unit for its price instead of Rs3,500 per unit under normal circumstances to limit the tariff hike. In response to a question, he confirmed that lower availability of the Karachi Nuclear Power Plant Unit-2 (K-2) had also contributed to the higher FCA, while its past claims worth Rs3.4bn were another factor behind the increase. Another official explained that the