ISLAMABAD, AUGUST 9: A fuel charges adjustment (FCA) increases of up to Rs. 2.56 per unit has been approved by the National Electric Power Regulatory Authority (NEPRA); these increases would be collected in August bills.
Power users will bear an extra financial burden of Rs. 33.45 billion as a result of this increase. When the 18% general sales tax (GST) is taken into consideration, this burden might increase to Rs. 39 billion.
The difference between what was previously charged and the true cost of producing electricity is what led to the adjustment. Higher prices for oil and LNG, as well as a decline in the demand for power, were the main causes of the increase in generation costs.
All consumer groups will be impacted by the hike, with the exception of lifeline customers and electric vehicle charging stations. Citing a higher-than-expected fuel cost of Rs. 9.77 per unit compared to the reference cost of Rs. 7.14 per unit, the state-run electricity distribution companies (DISCOs) had initially requested permission to charge an extra Rs. 2.63 per unit.
The Central Power Purchasing Agency (CPPA) brought up the higher expenses during a public hearing on July 31. It was noted that the outage of the Neelum-Jhelum Hydropower Project and lower-than-expected generation from hydro and local coal sources were contributing factors. Furthermore, system constraints forced the use of fuels like RLNG, which did not constitute a major portion of the reference mix, resulting in a 10% shortfall in real generation.
13,459 gigawatt-hours (GWh) of electricity were produced in the nation in June at a fuel cost of Rs. 119.7 billion, or Rs. 8.89 per unit. Of this, DISCOs received 13,071 GWh for a total of Rs. 127.7 billion (or Rs. 9.77 per unit). The June 2024 fuel cost adjustment is Rs. 2.63 per unit, which is 40% more than the Rs. 1.88 per unit from the previous year.
