Karachi residents are bracing for higher electricity bills as the National Electric Power Regulatory Authority (Nepra) has announced a tariff hike of Rs4.45 per unit for K-Electric (KE) customers. This decision, part of the first quarterly adjustment of the previous fiscal year, was disclosed through a notification from the Power Division.
Additionally, the extra charges collected from KE consumers will be reflected in their October and November 2023 electricity bills, as stated in the notification.
Furthermore, in response to a request from KE, Nepra has granted approval to include the actual or prudent expenses associated with the temporary operation of Unit-3 of Bin Qasim Power Station (BQPS-I) from May 1 to August 15, 2021, in cost calculations. This adjustment modifies previous decisions made by Nepra on September 15, 2021, and May 12, 2022, regarding this matter.
Nepra's order, issued on Friday, expressed the authority's agreement to accommodate KE's request and allow the actual/prudent costs related to the interim operation of Unit-3 of BQPS-I to be factored in. However, one member of the authority, Mathar Niaz Rana, voiced concerns about the additional fuel expenses resulting from KE's inefficiency, stating that these should not be transferred to consumers.
In a public hearing held on January 25, 2023, KE presented its case, explaining that the temporary use of Unit-3 of BQPS-I was chosen to meet Karachi's high summer demand and avoid more expensive power generation methods or power outages, aligning with the Nepra Act Sections 31(2) & 32(3).
Nepra's deliberations considered that the delays in commissioning BQPS-III and the subsequent use of inefficient Unit-3 of BQPS-I were due to KE's poor performance, and consumers should not bear the costs of these inefficiencies. Therefore, the operation costs of Unit-3 of BQPS-I were restricted to the level of BQPS-III.
Nepra acknowledged that KE had already operated Unit-3 of BQPS-I when the Licensee Proposed Modification (LPM) decision was issued in September 2021 and had imposed a fine of Rs200 million on KE for prior issues. To avoid double penalties, KE should not incur additional charges. In line with the Appellate Tribunal's judgment and KE's submissions, the Authority believes that if the interim operation of Unit-3 of BQPS-I was allowed in the public interest, the operating costs should be considered reasonable and allowable under Section-31(3)(a) of the Nepra Act.
