ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) on Wednesday approved a second increase in power tariff within a week for the consumers of K-Electric.

The regulator, on a request by the Karachi-based power utility, gave the approval of Rs2.87 per unit hike, which comes as part of a quarterly tariff adjustment (QTA) from January to March 2023. The decision has been forwarded to the federal government for notification.

This is the second time Nepra has hiked power tariff under the quarterly adjustment, the first one at the request of the federal government.

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On December 29, Nepra approved a Rs1.25 per unit increase for the January-March 2023 quarterly adjustment.

Dismayed business community rejects yet another rise in a week

The total effect of these changes in tariff is Rs4.12 per unit, which is projected to have a substantial impact on Karachi consumers.

Consumers are concerned about the city’s rising electricity costs as a result of repeated approvals.

Director communications and spokesperson for K-Electric Imran Rana said Nepra made the decision on QTA for January-March 2023. Under a uniform tariff policy applicable across the country, the QTA impact is generally not passed on to the consumers, he said, adding that a formal decision will be taken by the government.

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The power sector regulator stated that the increase aimed to address the backlog related to quarterly tariff adjustments and implement the uniform tariff policy and regulatory regime across the country.

Business community representatives at the hearing asserted that Karachi’s enterprises were suffering due to the ongoing increase in electricity costs. They said tariff hikes occurred due to fuel adjustments and, at other times, owing to a uniform rate across the country.

They rejected any further tariff increases, emphasising that the rising cost of electricity would lead to future increases in the prices of manufactured goods.

The federal government had approved the raise in accordance with the National Electricity Policy 2021 to maintain a standard consumer-end tariff for K-Electric and state-owned distribution companies.

In December 2023, Nepra notified consumers of ex-Wapda distribution companies of an additional fuel cost adjustment of Rs3.08 per unit, with a net financial impact of about Rs28.5 billion for the power consumed in October.

According to Nepra’s announcement, the adjustment will apply to all consumer categories, except electric vehicle charging stations and lifeline consumers.

Published in Dawn, January 4th, 2024