NEPRA Concludes hearing on February’s FCA Adjustment for KE Customers

Pakistan (Muhammad Yasir)

NEPRA concluded its public hearing on Thursday on KE’s request for an increase of PKR 1.662 per unit on account of Fuel Charges Adjustments (FCA) for February 2023. A similar hearing was also conducted on the request made by Government Distribution Companies (XWDISCOs) for customers in their territories. Following the regulator’s approval, these charges will apply to customer bills for only one month.

FCAs are linked with changes in global fuel prices used for energy generation and passed onto customer bills under the prescribed rules and regulations. February’s FCA request was higher primarily due to an increase in RLNG cost by SSGC and PLL by 12% and 18% respectively as compared to that of December 2022. Similarly, the cost of power purchased from CPPA-G has also increased by 15%, while furnace oil prices decreased by 10%. NEPRA scrutinized KE’s request and will issue a final decision on the amount to be passed on to customers as per its protocol.

NEPRA and the Government of Pakistan have developed the governing policies and regulations which determine the costs recovered from customers in their monthly bills. Individual Distribution Companies cannot influence the process or make unilateral changes.

Federal Government’s Quarterly Adjustment Requests for KE customers to be heard on 3rd April:

NEPRA will also conduct a separate hearing on April 3rd on the Federal Government’s requests to apply Quarterly Adjustments on KE customers. These pertain to the 2nd quarter of FY22 and the first quarter of FY23. Application of these adjustments on KE consumers along with their period of recoverability will be determined by NEPRA followed by a notification from the Government.

In the first request, the Federal Government is seeking NEPRA’s approval to apply PKR 1.55 rupees per unit on all customer categories for units consumed in July, August, and September 2022. The amounts will be recovered in bills for the months of April, May, and June 2023 respectively. In the second request, the Government is seeking approval to apply charges on units consumed in February and March 2023 to be recovered in April and May 2023 in the following manner: PKR 1.48 per unit for residential customers using up to 300 units except lifeline consumers; PKR 3.21 per unit for residential customers using more than 300 units, and PKR 4.45 per unit for all other categories. This is a continuation of the quarterly adjustment ranging from PKR 1.48 to PKR 4.45 per unit currently applicable for another two months.