KE Electricity Bills to Go Up in 2024

Staff Report

KE Electricity bills are set to go up in January-February and March 2024 on account of quarterly adjustments.

Residents of Karachi are set to face heightened financial pressure in the coming three months, as the National Electric Power Regulatory Authority (NEPRA) on Friday allowed K-Electric to recover an additional Rs1.7178 per unit from its clients in their January-February and March 2024 bills.

This recovery is on account of two positive Quarterly Tariff Adjustments (QTAs) for the fiscal year 2022-23.

It should be noted that on December 6, 2023, the Ministry of Energy (Power Division) submitted a motion concerning the recommendation of a consumer-end tariff for K-Electric. Check KE Duplicate Bill |K-Electric Duplicate Bill 2023

This recommendation was based on certain sections of the NEPRA Act 1997 and Rule 17 from 1998, which deals with how NEPRA sets tariffs (prices).

The Division also finalized the quarterly tariff adjustments for XWDISCOs for the second quarter of FY2022-23 at Rs. 0.4689/kWh. The recovery period for this adjustment spans three months, from April to June 2023.

Additionally, the authority determined the third quarterly adjustment for XWDISCOs for the same fiscal year at Rs1.2489/kWh.

The recovery period for this adjustment was three months, covering July to September 2023.

These determinations have been duly notified and successfully recovered from the consumers of XWDISCOs.

Following the National Electricity Policy 2021, the government may maintain a uniform consumer-end tariff for K-Electric and state-owned distribution companies (even after privatization) through direct/indirect subsidies.

Accordingly, K-Electric’s applicable uniform variable charge must also be modified to recover the revenue requirements as determined by the Authority, consistent with the uniform national tariff of XWDISCOs.

This modification has been approved by the Federal Government and was decided to be submitted to the Authority for consideration under the provisions of the Act.

The ministry further stated that the Cabinet’s Economic Coordination Committee (ECC) approved, on August 7, 2023, the implementation of a uniform QTA to address delays in maintaining consistency for future K-Electric consumers. Guidelines were issued to NEPRA for this purpose.

The Cabinet officially ratified the ECC’s decision on August 9, 2023. The ECC, following the established guidelines, sanctioned the application of the third-quarter tariff adjustment (QTA) for the fiscal year 2022-23 at Rs1.2489/kWh for K-Electric consumers on August 9, 2023.

It was also highlighted that the Authority, in a September 11, 2023 hearing, requested Cabinet endorsement for applying XWDISCO’s QTA of Rs0.4689/unit to K-Electric consumers in line with future NEPRA determinations. The Cabinet approved this on November 10, 2023.

The federal government presented the case in a public hearing by NEPRA held on December 20, 2023.

After reviewing submissions from the Federal Government, the provided Guidelines from the Ministry, and stakeholder comments, the Authority acknowledged the Federal Government’s intent to standardize tariffs nationwide in alignment with the National Electricity Policy 2021.

Consequently, the Authority approved the motion filed by the Federal Government.

The rate of Rs0.4689/kWh will apply to consumption in April, May, and June 2023. This will be recovered from K-Electric consumers over three months, from January 2024 to March 2024.

Likewise, the rate of Rs1.2489/kWh will apply to consumption in July, August, and September 2023. This amount will also be recovered from K-Electric consumers over the same three months in 2024.