ISLAMABAD: With a 1.6 per cent growth in electricity demand over last year, the public sector power distribution companies (Discos) have sought about Rs2 per unit negative fuel price adjustment (FCA) for electricity consumed in January as nuclear power emerged as the single largest source with 27pc contribution to the national grid.

If approved, the ex-Wapda Distribution Companies (Disco) would have to refund about Rs7.8 billion to consumers in March — almost half of the total savings in fuel costs in January. The fuel cost for power generation in January 2025 is about Rs3.62 per unit, lower than January 2024.

This will be 7th consecutive monthly decline in fuel mainly because of substantially higher costs allowed by the National Electric Power Regulatory Authority (Nepra) through a 20pc increase in base tariff effective July 1, 2024. About 71pc of the total power supply during January flowed from domestic fuel sources, almost 15pc of that at zero fuel cost.

The Central Power Purchasing Agency (CPPA), which filed the petition for negative adjustment of fuel cost for January, said the power consumption was 1.6pc higher than last year and 4pc lower than in December 2024. It reported that electricity delivered to Discos stood at 7,816 gigawatt hours (GWh) in January 2025 compared to 7,838Gwh in January last year and 7,516 Gwh in December 2024.

Another key feature appearing in the petition is about 25pc lower fuel cost in January 2025 year-on-year, which stems from a substantially higher base tariff for the current year and lower than estimated consumption, thus a fall in imported fuels.

Regulator fixes hearing on 27th

The power companies have claimed in their petitions that the average fuel cost amounted to Rs11 per unit in January 2025 compared to Rs14.62 per unit in the same month last year.

Nepra has called a public hearing on Feb 27 to take up a petition filed by the CPPA — a subsidiary of the Power Division — seeking “a decrease of Rs2.0019 per kWh over the reference fuel charge of Rs13.01 per unit”. The CPPA said the actual fuel cost was Rs11.008 per unit. It sought an application for a revised FCA in March’s bills.

It said about 8,153 GWh of electricity was generated at an estimated fuel expenditure of Rs88bn (Rs10.79 per unit) in January, of which 7,816GWh energy was delivered to Discos at a cost of Rs86bn (at Rs11 per unit).

Nuclear energy took over the top position in the electricity supply to the national grid, and the hydroelectric supply dropped to 5th position with just a 10.63pc share in the power supply due to the annual canal closure for maintenance. Nuclear power contribution to the grid improved to almost 26.6pc, up from less than 20pc in January 2024.

The second biggest share in the national grid came from RLNG at 19pc, down from about 21pc in December. This was followed by a 15.56pc share from local coal and then 13pc share of local gas.

The supply from coal-based generation increased to 24pc in January compared to 11.6pc in December. Of this, the share of imported coal-based generation was 8.5pc to the national grid.

In January, the LNG-based power generation cost stood at Rs22.47 per unit, followed by Rs20.96 per unit from imported coal and Rs12.5 per unit on local coal.

On the other hand, the cost of local gas-based generation slightly dropped to Rs13.21 per unit in January from Rs13.4 per unit in December. The nuclear fuel cost amounted to Rs1.8 per unit — up from Rs1.7 per unit in December.

Three renewable energy sources — wind, bagasse and solar — contributed 4.9pc share to the grid. Wind and solar energy have no fuel cost, while bagasse-based generation costs Rs5.98 per unit.

Published in Dawn, February 20th, 2025