June 23, 2022: K-Electric requested National Electric Power Regulatory Authority to allow an increase in the power tariff by Rs 11.33 per unit on account of fuel charges adjustment (FCA) for the month of May 2022.
As per applicable tariff across the country, fuel adjustment is reviewed every month and is applicable on consumer bills for only one particular month, said KE release on Thursday.
It maintained that the major impact on the monthly fuel cost adjustment of May 2022 was due to an increase in furnace oil price and power purchased from CPPA-G. The price of furnace oil in May 2022 had increased by 38 percent from March 2022 while the price of RLNG between March to May 2022 had increased by 50 percent.
The price of electricity from CPPA-G in May 2022 had increased by 53 percent. The price of CPPA-G as of May 2022 was Rs 13.897 per KWh as compared to the price of Rs 9.387 per KWh in March 2022.
FCA was incurred by utilities due to global variation in fuel prices used to generate electricity and change in the generation mix. These costs are passed through to the consumers following NEPRA's scrutiny and approval and are one-time charges. Consumers also receive a benefit when the cost of fuel decreases.
On NEPRA guidelines, the submissions would be discussed in the public hearing on the 4th of July. The regulator would approve the request, after scrutiny, and issue instructions on the period during which these costs could be applied to consumer bills.