Islamabad: NEPRA will conduct a public hearing today to discuss petition submitted by K-Electric on Fuel Adjustment Charges (FCA) for the month of November 2021 and Quarterly Adjustments for the period July till September 2021.
The request made by the utility are in line with the mechanism given in KE’s Multi Year Tariff whereby changes in Fuel prices, generation and power purchase mix are passed through along with certain adjustments.
Fuel Charge Adjustment (FCA) are incurred by utilities due to global variations in fuel prices used to generate electricity. Across Pakistan, these costs are passed through to the consumers following NEPRA’s scrutiny and approval.
Consumers also receive a benefit when the cost of fuel decreases. In both scenarios, there is no impact on KE’s profitability as these are simply operational expenses being recovered.
For the month of November, KE has requested for Fuel Charges Adjustment with an average impact on consumer of 31 paisa per unit, however, final decision will be made by NEPRA after scrutiny with instruction on the period during which these costs can be applied to consumer bills.
KE also requested for Quarterly adjustments for the period July till September 2021 with an estimated impact of 5.182 rupees per unit. This increase in September 2021 was necessary due to increase in fuel prices in September 2021 by 61% (RLNG) and 28% (Furnace oil).
However, with Government of Pakistan’s policy of Uniform Consumer Tariff across the country, this variation is not likely to impact consumers.
These hearings are part of a regular process, whereby the regulatory authority scrutinizes the adjustment requests based on the facts and figures.
State-owned DISCOs are usually heard in one sitting while K-Electric’s hearings are conducted separately.
