Electricity Consumers Paying for 40,000 MW

Staff Report: The officials of National Transmission & Despatch Company (NTDC) made a shocking disclosure on Wednesday that consumers were paying a capacity of 40,000 MW despite utilizing less electricity.

The consumers use 12000-13000 MW of electricity but have to pay for a capacity of 40,000 MW,” NTDC officials said during the public hearing here.NEPRA to Launch ‘Asaan Approach’ App for Easier Electricity Complaints Tomorrow

The consumers are set to get a nominal reduction in electricity prices up to 31 paisa per unit on account of fuel adjustment for month of July 2024.
The CPPA had requested a reduction of 31 paisa per unit in the price of electricity. Consumers will get relief of 4.5 billion rupees for the month of July, according to CPPA officials.

There was 4% less electricity generated from hydel resources in July, CPPA officials noted. During this period, more electricity was generated from imported coal, officials added.

Global fuel prices continued to trend downward, CPPA officials said. If economic indicators remain the same, there will be slight change in electricity prices, the CPPA noted.

“If the losses are removed, how much relief will be for consumers?” inquired NEPRA member Rafiq Shaikh. NTDC officials could not answer the question, which led to NEPRA members expressing displeasure at not getting a response.

NEPRA officials stated that energy growth has not witnessed increase in the last six years.

Member NEPRA Rafiq Shaikh asked, “What was the cost of reducing system losses, and how much burden did it place on consumers?” He further called for an analysis to determine responsibility. “Now, electricity bills are more than house rent,” noted member NEPRA Rafiq Shaikh.

“There are reports of an increase in house rents due to electricity bills,” mentioned member NEPRA Sindh, Rafiq Shaikh. “Hearing this news, our heads are bowed in shame,” he added.

NEPRA completed the hearing and reserved its decision. A final decision will be issued after further data examination by NEPRA.

Quarterly Adjustments for April to June 2024:
Meanwhile, the consumers were going to face an increase in electricity rates up to Rs 1.89 per unit on account of quarterly adjustment.
Nepra in a statement said that an application for the fourth quarter adjustment of the last fiscal year (2023-24) was submitted by power distribution companies to NEPRA.

NEPRA conducted a hearing on this application on August 26, 2024. In the application, a total of 46.991 billion rupees has been sought for the fourth quarter adjustment of the year 2023-24.

If this quarterly adjustment is applied to bills for September, October, and November, it will amount to Rs 1.89 per unit, according to NEPRA.
The third quarter adjustment of 2023-24, which is Rs 0.93 per unit, is set to end in August. As a result, an increase of Rs 0.96 per unit is expected in the September bills due to the quarterly adjustment.

It further said that a fuel price adjustment request for July 2024 was submitted by CPPA on behalf of electricity distribution companies to NEPRA on August 15, 2024.

NEPRA reviewed this application on August 28, 2024. The petition requests a reduction of Rs 0.31 per unit, which will be reflected in September bills.
Consumers paid a fuel price adjustment of Rs 2.56 per unit in August bills. Therefore, a reduction of Rs 2.87 per unit is expected in September bills due to the fuel price adjustment.

Combining the two adjustments, consumers are expected to receive a relief of Rs 1.91 per unit in their September bills, according to NEPRA.