NEPRA increases power tariff to ensure financial viability of DISCOs

August 10, 2020 (MLN): The National Electric Power Regulatory Authority (NEPRA) has made adjustments in the approved tariff on account of variations in the fuel charges from November 2019 to June 2020 for all power distribution companies.

The Fuel Cost Adjustment (FCA) calculations have been delayed by the authority which helped consumers with the limited increase in electricity rates.

According to a notification issued by NEPRA, the fuel cost in December’19 was high when the FCA was Rs 1.8779 per kWh, while it notified Rs1.1108 per kWh FCA for January’20, which increased to Rs1.2051 per kWh FCA for February’20.

The Authority being cognizant of the fact that the period for which FCAs are being allowed i.e. November 2019 to June 2020, has already lapsed and variations on account of fuel cost have not yet been recovered or passed on to the consumers.

In order to ensure the financial viability of the DISCOs, the authority believes that any such variations need to be passed on to the consumers in a timely manner, which otherwise would result in piling up of the legitimate costs and may impact their financial viability.

The authority has decided to club the positive and negative FCAs to minimize the impact on consumers and apply the same in two months period i.e. August and September.

Going into details, the FCAs pertaining to January’20, February’20, March’20, and May’20 will be charged in the electricity bills for the month of August’20.

While the fuel adjustment charges for the months of November’19, December’19, April’20, and June’20 will be charged in September’20.

FCAs will be applicable for all consumer categories except for the lifeline ones.

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