KARACHI, September 29, 2022: The National Electric Power Regulatory Authority (NEPRA) concluded a public hearing on K-Electric’s (KE) Fuel Charges Adjustment (FCA) application for the month of August 2022 on Thursday, September 29. The power utility has requested a reduction of PKR 4.21 per unit under FCA for August 2022. The benefit of this reduction will be passed on to consumers through October 2022 bills. The FCA is reviewed every month as per the tariff regime applicable across the country and is applicable to the consumer’s bills for one month only.
August’s FCA is lower compared to the previous month primarily due to decrease in fuel prices. The price of power purchased from CPPA-G in August 2022 has decreased by 33% as compared with June 2022. Similarly, for RLNG, the price in August 2022 decreased by 16% from June 2022. For Furnace Oil, the price in August 2022 increased by 3% from June 2022.
As per KE’s spokesperson, fuel adjustment is reviewed every month and is applicable on consumer bills for only one particular month per applicable tariff across the country. FCA is incurred by utilities due to global variation in fuel prices used to generate electricity and change in the generation mix.
Furthermore, Consumers also get benefit when fuel prices decline as compared to reference month. FCAs are applied after NEPRA’s scrutiny & public hearings, which are conducted independently for KE and state-owned entities (XWDISCOs). Alongside final approval on the FCA to be charged to consumers, the NEPRA Authority also specifies the period during which these FCA can be applied to consumer bills.
K-Electric (KE) is a public listed company incorporated in Pakistan in 1913 as KESC. Privatized in 2005 KE is the only vertically integrated utility in Pakistan supplying electricity within a 6500 km2 territory including Karachi and its adjoining areas. The majority shares (66.4%) of the company are listed in the PSX owned by KES Power, a consortium of investors including Aljomaih Power Limited of Saudi Arabia, National Industries Group (Holding), Kuwait, and the Infrastructure and Growth Capital Fund (IGCF). The Government of Pakistan.