By Staff Reporter
ISLAMABAD: Pakistan’s power regulator cleared a smaller-than-requested increase in fuel charges for May, a decision that will add roughly Rs4.2 billion to consumers’ bills even as the net cost of electricity edges lower next month.
The National Electric Power Regulatory Authority approved a positive Fuel Charges Adjustment of 33.64 paisa per unit for May, according to a notification issued Wednesday. The increase applies to customers of power distribution companies and K-Electric, and will show up in bills for the July billing cycle.
The approved figure came in well below what the Central Power Purchasing Agency-Guaranteed had sought. The state-run power buyer had asked Nepra to approve an adjustment of 81.73 paisa per unit, based on its calculation that actual fuel costs for May reached Rs9.2488 per unit, compared with a reference cost of Rs8.4315 per unit. Nepra’s own review put the actual fuel cost at Rs8.7679 per unit, roughly 48 paisa lower than the power purchasing agency’s estimate, narrowing the adjustment accordingly.
The regulator specified that the charge won’t apply uniformly across all customers. Lifeline consumers, electric vehicle charging stations, and prepaid electricity customers across all categories are exempt, Nepra said in its notification. The higher charge will, however, extend to consumers under the incremental consumption package.
Even with the increase, households and businesses may see little change — or a modest improvement — in their overall bills. The new charge of Rs0.336 per unit will replace June’s fuel cost adjustment of Rs1.19 per unit, which is set to lapse. That shift means net average fuel costs in July are expected to run about 4 paisa per unit below June’s level, even as the newly approved charge takes effect.
Nepra’s determination followed a public hearing held June 30, which drew officials and industry representatives including Rehan Javed of the Korangi Association of Trade and Industry. The session surfaced broader questions about the trajectory of electricity costs beyond the immediate fuel adjustment.
Amir Sheikh pressed CPPA-G on the outlook for the Quarterly Tariff Adjustment for the current quarter, citing reduced electricity consumption, and asked when consumers might see savings from lower oil prices, RLNG terminal charges, and the captive gas levy passed through to bills. CPPA-G responded that the quarterly adjustment would be finalized once June’s actual figures are in, and indicated that the Pakistan Power Management Company does not anticipate a significant increase. On fuel price relief, the power purchasing agency said any savings would flow through the applicable monthly fuel adjustment under existing regulatory procedure. It said it had no information on RLNG terminal charge waivers, and noted the captive gas levy issue remains before the courts.
Imran Shahid, representing Jamaat-e-Islami, raised a separate concern: that the fuel charge increase stemmed partly from underuse of lower-cost power plants and the inclusion of part-load charges. The Independent System and Market Operator pushed back, saying efficient generation units are dispatched strictly according to system demand. CPPA-G, for its part, said part-load charges are billed in line with existing power purchase agreements.
Under Pakistan’s tariff framework, monthly fuel cost changes are passed through to consumers automatically, while broader adjustments — covering power purchase prices, capacity charges, operation and maintenance costs, system-use charges, and transmission losses — are folded into the base tariff on a quarterly basis by the federal government.
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