Nepra perturbed by a steady decline in power consumption
Business
Notes adverse effects on consumers due to capacity charges
- Calls for boosting demand, revisiting tariff structure
- Says final decision on monthly cost adjustment for February to be announced later
ISLAMABAD (Web Desk) – The National Electric Power Regulatory Authority (Nepra) on Wednesday expressed its annoyance over the reduced electricity demand and questioned why the authorities concerned were not working on boosting consumption.
It was at a public hearing held in connection with the request made by the power distribution companies (Discos) to fix the fuel cost adjustment (FCA) for the month of February at Rs4.99 per unit where Nepra Chairman Waseem Mukhtar and the members raised their concerns over the trend.
They said the inability to increase demand was resulting in burdening the power consumers with higher electricity tariffs because of the capacity charges.
However, it is not the first time that the Nepra has questioned the authorities concerned over the reduced power consumption and negative impacts it is having on the households and businesses.
Another point mentioned was using the costly fuels for electricity generation which meant that the weaker rupee and higher share of imported sources resulted in regular FCA hikes as well as increase in quarterly adjustment.
During the hearing, the Nepra top brass also talked about revisiting the tariff structure especially to revive economic activity by incentivising power consumption for the industrial sector.
Share the detailed data of each component to explain the reason behind the figures [Rs4.99] calculated for the FCA, said one of the Nepra members.
On their part, the National Transmission and Dispatch Company (NTDC) officials defended the use of RLNG for power generation, saying the production cost was much lower at the time these had been commissioned.
They admitted the constant trend of reduced consumption and cited the installation of solar panels at “every other home” in Lahore as the reason, saying the population was a rise but power demand had been on a decline.
However, they didn’t give any satisfactory reply when it came to the reduced consumption by the industrial sector.
Later, the Nepra concluded the hearing after hearing the arguments presented by all the parties concerned and said the final decision would be announced after further deliberations.
It is worth noting that the higher energy prices and interest rates have increased the cost of doing business in Pakistan manifold, discouraging any expansion in existing industrial units and establishment of new ones.
The public hearing was held after the Central Power Purchasing Agency (CPPA on the behalf of Discos requested the Nepra to finalise the FCA for February at Rs4.99 which is to be collected through the monthly bills in April.
A petition filed by CPPA mentioned a 14.24 per cent decline in power generation in February 2024 over the previous month, which represents an 8.07pc decline when compared with the same month last year.
When it comes to the sources of power generation, hydropower’s share stood at 25pc in February. It was followed by nuclear 23.3pc, RLNG 20.33pc and coal 15.8pc.
Meanwhile, there was no power generation from furnace oil and diesel-fired plants against a 10pc share in January.
