Govt seeks Nepra's approval for Rs6.51 per unit hike in electricity tariff

• Power purchase price increase sought from Rs20.60 to  Rs27.11/unit.
• Nepra set to determine tariff hike increase in line with IMF's diktat.
• Officials predict increase in base tariff from Rs29.7 to Rs36.28/unit. 
  

ISLAMABAD: The federal government has filed a petition before the National Electric Power Regulatory Authority (NEPRA) seeking an increase in electricity tariff of Rs6.51 for determining the base tariff for the financial year 2024-25, The News reported on Thursday.

As per the publication, the government wants the power purchase price to be jacked up to Rs27.11 per unit from the existing Rs20.60 per unit.

The development comes as the regulatory body, last week, approved Rs2.83 per unit hike in power tariff for the month of March 20204, on account of monthly fuel adjustment.

According to the Nepra's notification, the said adjustment of Rs2.8372.kWh was applicable to all the consumer categories except the Electric Vehicle Charging Stations (EVCS), lifeline consumers and K-electric consumers.

On the current hike sought by the government energy ministry officials say that the base tariff for the financial year 2024-25 may surge to Rs36.28 per unit from the existing base tariff of Rs29.78, which was at Rs24.82 per unit in 2022-23 in case distribution margin and prior year adjustments are added.

They also say that end consumer tariff during peak hours for domestic consumers will go up to Rs48.51 per unit from over Rs42 per unit if the admissible losses of 11% of Distribution Companies (Discos), surcharges, taxes and duties are added up in the bills.

The CPPA petition mentions that the Discos are projected to purchase 130.876 billion electricity units at the cost of Rs3.589 trillion during the next fiscal year at a PPP of Rs27.11 per unit and Rs3.3 trillion at a PPP of Rs25.03 per unit.

The capacity payments for the Financial Year 2024-25 are also projected to surge up to Rs2.278 trillion mainly because the 1,002 megawatt of the three projects would be added in 2024. 

The 870 MW Sukhi Kinari Hydro Project will come on stream on November 30, 2024, the 100 MW Zorlu Solar Power project will come into the system on October 11, 2024, while the 32 MW Shahtaj Sugar Mill Limited will be operational on August 11, 2024. The Rs2.278 trillion capacity payments will contribute to Rs17.42/unit of electricity.

However, the existing capacity payments stand at Rs1.9 trillion which the end consumers pay as Rs14.09/unit in the electricity tariff.