Islamabad: The federal government has allowed Azad Jammu and Kashmir (AJ&K) government to set up a regular power distribution company (Disco) to streamline electricity distribution in the region.
The decision has been taken after allowing AJ&K to charge Rs 1.10 per unit water usage Charges (WUC) on Mangla Hydro Power Project as well as Neelum Jhelum hydropower project at part with net hydel profit paid to the provinces.
The government has asked Power division to facilitate AJ&K government to establish a regular Disco to streamline electricity distribution in the region after seeking license from Nepra. Till such time, electricity department of AJ&K has been asked to assume the functions of distribution company (Disco) and adopt the average tariff of three Discos-Gujranwala Electricity Power Co (Gepco), Islamabad Electric Supply Company (Iesco) and Peshawar Electric Supply Company (Pesco) for all categories.
The consumer tariff as Disco for AJ&K will be completed by June 30, 2019. Bulk power supply to AJ&K should will be made from CPPA-G as is being done in case of K-Electric as per tariff determination by Nepra. The government has also decided that support on power cost differential of Rs 2.59 per unit against government of Pakistan notified rate shall be eliminated and deficit grant to the government of AJ&K shall be adjusted against the revenue from this source.
Federal government will continue to provide tariff differential subsidy support to the electricity consumers of AJ&K as per government of Pakistan policy after due verification of claims by power division. Water usage charges at the revised rate of Rs 1.10 per unit shall be paid respectively only once the recovery through tariff begins after tariff determination by Nepra.This arrangement shall not have retrospective effect.
Wapda shall not seek any federal government support regarding payment of water usage charges to AJ&K. The new pricing system for water usage charges and consumer tariff as Disco for AJ&K to be completed by June 30, 2019. An agreement incorporating these decisions will be signed between government of AJ&K and other stakeholders of Pakistan amending the Mangla Raising agreement of 2003 to the extent of UWUC and terms of supply to AJ&K.