ISLAMABAD   -   NEPRA Friday allowed ex-Wapda distribution companies (Discos) an increase of Rs 1.4940 per unit in power tariff for the quarterly adjustment of July to December 2018-19. The NEPRA’s decision will allow ex-Wapda Discos to collect Rs 189638 million, for the first two quarters of 2018-19, in next 15 months period from the power consumers. In its decision in the matter of requests filed by XWDISCOs regarding periodic adjustment in tariff for 1st and 2nd quarters of FY 2018-19 NEPRA has allowed Discos to collect Rs189,638 million from the power consumers for two quarter adjustment of (July to September and October to December) 2018-19 which will increase of Rs 1.4940 per unit in power tariff. This is second time increase in tariff, during the ongoing year as the PTI government had increased power tariff by average Rs1.27 per unit in January 2019 on account of capacity payments.

In its decision NEPRA said in view the submissions of MoE/CPPA-G, and subject to para 24 the Authority has determined a uniform rate of Rs.1.4940/kWh, for the allowed amount of quarterly adjustment of Rs.189,638 million across each category of consumers of XWDISCOs, to be recovered in fifteen (15) months period, based on projected sales for the FY 2018-19. NEPRA has suggested the government to pass this impact to all consumers, including of less than 300 units per month; however lifeline consumers up to 50 units per month would be exempted from the price hike. The authority in its decision has also given previous adjustments. The final decision regarding the increase in power tariff will be made by the federal government and it will be applicable from 1st July.

It is pertinent to mention here that in March 2019 NEPRA had conducted public hearing on the petition of Central Power Purchasing Agency (CPPA) for additional revenue adjustment of Rs202 billion, involving about Rs2.50 per unit increase in uniform electricity tariff for all distribution companies (Discos) during fiscal year 2018-19. The CPPA had presented its tariff increase case on behalf of 10 Discos due to variation in power purchase price for two quarters July to September and October to December of 2018. The increase has been announced to recover the ex-WAPDA distribution companies’ adjustments on account of variation power purchase price (PPP), including impact of transmission and distribution (T&D) losses, capacity charges and variable operation & maintenance (O&M) charges for the first two quarters (July-Sept & Oct-Dec 2018) of the outgoing fiscal 2018/19.

Regarding IESCO the decision said that IESCO requested quarterly adjustments of Rs25,526 million, which included Rs.7,020 million on account of Advance Tax, Recruitment & retirement Costs, Excess billing by CPPA-G and Rs.2,054 million on account of a wrong adjustment of PPP by NEPRA for the FY 2017-18. The Authority observed that costs like advance tax, recruitment & retirement costs and excess billing do not fall within the scope of quarterly adjustments, hence, not considered while calculating the instant quarterly adjustment. For the remaining adjustments, the Authority has verified an amount of Rs16,373 million, exclusive of wrong adjustment of PPP of Rs.2,054 million. The difference of Rs.79 million is due to the fact that Iesco, for the month of Sep. 2018, used capacity charges of Rs.4.1810/kWh, whereas, the same as per the data provided by CPPA-G, is Rs.4.1151/kWh, which has been considered by the Authority in its workings. Regarding wrong adjustment of PPP for the FY 2016-17 i.e. Rs.2,054 million, the said cost has been verified afterwards, therefore, is allowed in the instant quarterly adjustments. Thus, a total amount of Rs.18,427 million is allowed to Iesco on account of quarterly adjustments.

Regarding Lesco, the decision said that the Disco requested quarterly adjustments of Rs.34,058 million, whereas, the same as per the Authority’s working works out as Rs.34,633 million; the difference of Rs.575 million is on account of wrong calculation of impact of losses on FCA by Lesco. Further, the PPP of LESCO for the FY 2016-17 was revised downward by CPPA-G by Rs.4,286 million, which was accordingly deducted while allowing PPP adjustments in the tariff of LESCO for the FY 2016-17 and FY 2017-18. The said cost has been verified subsequently, therefore, is allowed in the instant quarterly adjustments. Thus, a total amount of Rs.38,292 million is allowed to LESCO, on account of quarterly adjustments.

In its decision on the petition of Gepco the regulator said that the difference of around Rs.13 million between the amount claimed by GEPCO i.e. Rs.15,866 million and the amount allowed by the Authority i.e. Rs.15,853 million is owing to the fact that GEPCO, for December 2018, has worked out impact of losses on FCA, based on CPPA-G’s claimed amount instead of actual FCA approved by the Authority. Further, reference variable O&M cost, instead of actual, has been used by GEPCO for December 2018.

On FESCO the decision said that FESCO requested quarterly adjustments of Rs.39,500 million, whereas, the same as per the Authority’s working works out as Rs.23,922 million; the difference of Rs.15,578 million is primarily on account of impact of extra / less purchases claimed by FESCO i.e. Rs.15,565 million. The Authority observed that while working out the quarterly adjustments, actual units received and actual cost billed to the DISCO is considered, which automatically accounts for the impact of any extra / less purchases by the DISCO. Therefore, considering impact of extra/less purchases separately, would result in duplication of the cost. Further, PPP of FESCO for the FY 2016-17 was revised downward by CPPA-G by Rs.2,972 million, which was accordingly deducted while allowing PPP adjustments in the tariff of FESCO for the FY 2016-17 and FY 2017-18. The said cost has been verified subsequently, therefore, is allowed in the instant quarterly adjustments. Thus, a total amount of Rs.26,894 million is allowed to FESCO, on account of quarterly adjustments.

Mepco initially requested an amount of Rs.35,697 million which included Rs.18,654 million for the 1st quarter and Rs.17,043 million for the 2nd quarter. Afterwards, Mepco revised its claim for the 1st quarter to Rs.17,589 million instead of Rs.18,654 million, thus, requesting total amount of Rs.34,633 million. The same was verified and allowed to Mepco, said the decision.

Against its demanded Rs 31.1 billion by Pesco the authority allowed Rs 25.120 billion. The difference of Rs.5,948 million being the amount claimed by Pesco and the amount allowed by the Authority is primarily on account of impact of extra/less purchases claimed by Pesco i.e. Rs.5,731 million. The Authority observed that while working out the quarterly adjustments, actual units received and actual cost billed to the DISCO is considered, which automatically accounts for the impact of any extra/less purchases by the DISCO. Therefore, considering impact of extra/less purchases separately, would result in duplication of the cost. The remaining difference of Rs.217 million is due to non-inclusion of market operator fee of Rs.25 million and inclusion of extra impact of losses on FCA of Rs.242 million by Pesco in its working.

Originally Hesco had requested Rs 5.6 billion, however later submitted its revised working, whereby, it requested an amount of Rs.10. 236 billion. The Authority has verified an amount of Rs.11.984 billion against the claimed amount. The difference of Rs.1,748 million, between the amount claimed by Hesco and the amount allowed by the Authority is due to non-inclusion of fixed O&M cost for wind & solar plants of Rs.357 million, less claim on account of UoSC, Market Operation Fee (MoF) & impact of FCA of losses of Rs. 477 million and deduction on account of extra & less purchases of Rs.914 million by Hesco in its workings. The Authority observed that while working out the quarterly adjustments, actual units received and actual cost billed to the DISCO is considered, which automatically accounts for the impact of any extra / less purchases by the DISCO.

Sepco requested an amount of Rs.5,113 million, however, the Authority has verified the same as Rs.6,593 million; the difference of Rs.1,480 million is due to incorrect working by Sepco on account of impact of losses on FCA, variable O&M and upward revision of capacity charges by CPPA-G for the month of November 2018, which has not been accounted for by Sepco in its workings.

Tesco requested an amount of Rs.985 million, however, the Authority has verified the same as Rs.1,453 million The difference of Rs.468 million is due to non-inclusion of fixed O&M costs of wind and solar power amounting to Rs.416 million and incorrect working of impact of losses on FCA and variable O&M by Tesco. Similarly Qesco requested a total amount of Rs.8,440 million, whereas, the Authority has worked out an amount of Rs.10,390 million; the increase of Rs.1,950 million is due to incorrect working made by Qesco.