NEPRA Investigates Discos Amid Electricity Rate Hike Controversy

Staff Report

The National Electric Power Regulatory Authority (NEPRA) has launched an inquiry against power distribution companies (Discos) amid the electricity rate hike controversy

ordered an inquiry into the operations of Power Distribution Companies (Discos) following their demand for a Rs 7.13 per unit hike in electricity rates for January 2024 due to fuel adjustment.

NEPRA Chairman Waseem Mukhtar noted during the hearing that there had been no change in fuel prices or exchange rates, yet power companies had requested a higher increase in electricity rates.

In a session on Fuel Price Adjustments for January 2024, NEPRA Chairman Waseem Mukhtar, alongside members Engineer Maqsood Anwar Khan and Rafique Ahmad Shaikh, scrutinized the Central Power Purchasing Agency (CPPA)’s petition.

The regulator expressed concern over the burden proposed by distribution companies, who sought a Rs7.13 per unit increase under the Fuel Cost Adjustment (FCA) mechanism, citing systemic deficiencies.

NEPRA member inquiries revealed disparities in load-shedding patterns across regions despite claims of low power demand, casting doubt on the authenticity of the proposed adjustments.How to Access KE Duplicate Bills Online for 2024 (Updated January)

Additionally, NEPRA highlighted a backlog of 160,000 pending power connections in DISCOs, equivalent to 550 MW, and criticized Discos’ inability to justify their claims in previous hearings.

Chairman Mukhtar emphasized NEPRA’s commitment to accountability and announced plans for a comprehensive investigation into Discos’ operations under the provisions of the NEPRA Act.

Due to transmission system constraints and stability concerns, Distribution companies are also seeking to impose a burden of Rs26.7 billion on consumers in a single month, citing transmission system stability issues. Check IESCO Bill Online| Download IESCO Duplicate Bill April 2023

During a NEPRA session, member Rafique Ahmad Shaikh questioned the petitioner about the substantial claim, particularly regarding challenges in the South-North transmission corridor. The petitioner clarified that the issue stemmed from system stability rather than constraints.

Mukhtar urged the Power Division to devise effective strategies to mitigate the prevailing challenges, stating that the ongoing situation demands urgent attention and a proactive approach from the government, economy, and the power sector.

NEPRA admonished the Power Division against unfounded claims, signaling a departure from previous leniency towards such requests, and emphasized the imperative for tangible solutions to prevent further escalation of prices and demand.

The chairman concluded by reaffirming NEPRA’s commitment to serving both the government and consumers, asserting a zero-tolerance policy towards failures in power provision and urging proactive measures to address systemic inefficiencies.

NEPRA’s decision marks a significant step towards enhancing transparency and accountability within Pakistan’s power sector, as stakeholders work towards sustainable solutions to meet the nation’s energy needs.

Directive against excessive billing scam

NEPRA issued directives to power distribution companies (Discos) to take action against officials involved in an overbilling scam.

NEPRA’s inquiry in December 2023 revealed that not a single distribution company had carried out correct billings. Over 13 million consumers were charged for more than 30 days of electricity usage, and 0.4 million consumers were sent average bills due to faulty meters.

Despite the power division’s claims that only 0.2 million consumers were overcharged, NEPRA stood by its inquiry claims and issued directives to Discos, including K-Electric, to address consumer issues and take action against those involved in the overbilling scam.

These companies failed to provide satisfactory replies to the inquiry report after widespread overbilling complaints in July-August 2023.

NEPRA directed these companies, including K-Electric, to implement NEPRA’s inquiry report’s recommendations. The report highlighted that K-Electric was the only company using handheld devices for meter reading, ensuring transparency, and following monthly billing cycles as per regulatory guidelines.

In response to complaints and irregularities in electricity billing, NEPRA issued a comprehensive directive to Discos, instructing them to replace defective meters older than two months, charge consumers based on actual readings, collaborate with relevant authorities for billing review, and take disciplinary action against violators.

Discos have a one-month deadline to rectify identified discrepancies and submit a compliance report to NEPRA, underlining the authority’s commitment to fair and transparent billing practices.