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Electricity Tariff Goes up by 16 to 48pc

Latest Pakistan News / Islamabad News > The National Electric Power Regulatory Authority approved on Tuesday an increase in electricity tariff by between 16 and 48 per cent for four months under the monthly fuel adjustment formula.

Electricity Tariif Goes Up

Despite objections raised by one of its members, the three-man regulatory body, short of its full strength of five members, took the decision to approve a Rs2.24 per unit increase (47.5pc) from its reference fuel tariff of Rs4.71 per unit for October last year.

Likewise, the fuel tariff for November 2011 was increased by Rs1.30 per unit (26pc) against reference tariff of Rs5.025.

The increase for December 2011 was 99 paisa per unit (15.76pc) against the reference tariff of Rs6.28. Likewise, the fuel tariff for January 2012 was increased by Rs1.96 per unit (26.8pc) from its reference rate of Rs7.32 per unit.

As the regulator cleared the new rates, a government representative requested it on behalf of the water and power ministry to order recovery of new rates in four months, instead of passing on the impact to consumers in one go. The regulator, however, reserved its decision till the issuing of a formal notification.

The Nepra hearing was presided over by its Vice-Chairman Ghiasuddin Ahmed in the absence of Khalid Saeed, who had submitted his resignation on Monday.

Nepra’s member from Khyber Pakhtunkhwa Shaukat Ali Kundi challenged the reference fuel tariff assumed on the basis of Rs45,000 per ton cost of furnace oil presented by the case officer saying the reference tariff assumed for proposed tariff adjustment was lower than previously approved by the regulator, resulting in requirement for higher tariff increases.

He said that Nepra had already approved the reference tariff on the basis of Rs66,700 per ton cost of furnace oil which if applied for tariff adjustment would result in lower tariff increase.

He insisted that since the regulator had twice rejected the water and power ministry’s request and review appeal for assuming reference furnace oil cost at Rs66,700 per ton, there was no justification for the regulator to unilaterally undo its own decision.

A public representative said that since the three-member regulator had unanimously rejected the power ministry’s request, even if Nepra desired to accept furnace oil price at Rs45,000 per ton that prevailed in financial year 2010-11, it would require under the law to revise its earlier determinations through a larger bench, comprising at least four members.

Nepra’s case officer, however, contended that since the government had not notified the tariff determinations on eight distribution companies under which the regulator had approved the furnace oil cost at Rs66,700 per ton as reference tariff, Nepra would have to accept previous furnace oil cost, despite having twice rejected the government’s request.

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