K-Electric faces Nepra show cause notice for rejecting net-metering applications

November 15, 2024 (MLN): The National Electric Power Regulatory Authority (NEPRA) has issued a show cause notice to K-Electric (KE) following repeated failures to comply with regulatory directives related to net-metering applications.

This formal action, announced on Wednesday, underscores NEPRA’s concern over KE’s ongoing non-compliance with key provisions of the NEPRA Act and its regulatory framework.

The issue centres on K-Electric’s systematic rejection of net-metering applications, often citing overloading issues within its distribution network and Pole-Mounted Transformers (PMTs) as grounds for denial.

Net-metering, a critical initiative supporting the adoption of renewable energy in Pakistan, enables consumers to offset electricity costs by generating surplus power.

Nepra’s intervention highlights the importance of transparent processing in this program.

The regulatory body had initially directed KE in May 2024 to submit specific details regarding rejected net-metering applications.

These requests aimed to clarify the extent of system overloads and KE’s rationale for rejecting applications.

However, KE requested an extension but failed to provide the necessary data within the designated timeframe, marking a significant lapse in compliance.

In response to an explanation letter from NEPRA in July, KE submitted partial information, revealing that net-metering applications exceeding 80% of a transformer’s capacity would necessitate infrastructure upgrades funded by applicants.

However, NEPRA found KE’s response lacking in transparency and non-compliant with the required standards for consumer access to net-metering services.

NEPRA’s dissatisfaction with KE’s submission has now culminated in a show cause notice issued under the authority’s fine regulations.

The notice mandates KE to address its non-compliance and submit a detailed explanation for its handling of net-metering applications.

This response is critical, as the regulatory authority views KE’s actions as counterproductive to Pakistan’s renewable energy goals.

NEPRA spokesperson underscored the importance of adhering to fair and transparent processes, noting that KE’s actions have raised barriers for consumers seeking renewable energy solutions.

“The authority emphasizes the need for clarity in KE’s application handling to ensure consumer rights are protected, particularly as net-metering represents a key pillar of Pakistan’s shift towards sustainable energy,” the spokesperson stated.

K-Electric, Pakistan’s largest private utility provider, has yet to issue a public response to the notice.

The ongoing scrutiny from Nepra adds to the company’s regulatory pressures, as it navigates growing demand for energy solutions amid infrastructural constraints.

NEPRA's firm stance in this matter reflects its commitment to maintaining accountability and ensuring that utility providers facilitate, rather than hinder, consumer participation in renewable energy initiatives.

As Pakistan continues its transition towards sustainable energy, NEPRA’s enforcement action signals the authority’s resolve to hold utility providers accountable for transparent, consumer-centric practices that align with national energy goals.

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