K-Electric to refund Rs7.43/unit in Jan 2023 under FCA

• NEPRA holds public hearing on petitions.
• K-Electric to reimburse its consumers for the fifth month in a row.
• KE refunded Rs2.456/unit to consumers in their December bills.

ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) on Tuesday, after hearing petitions of K-Electric, directed the company to refund Rs7.43/unit to its clients in January 2023 bills on account of Fuel Charges Adjustment (FCA) for November 2022, reported The News on Wednesday.

The Karachi-based power facility had submitted its application to NEPRA, expressing its willingness to return Rs7.04/unit to consumers.

Chairman NEPRA Tauseef Farooqi chaired the NEPRA hearing. At the same time, the authority members from KP Engr Maqsood Anwar Khan, Balochistan Mathar Niaz Rana, and Sindh Rafique Ahmad Shaikh were also present.

NEPRA made the proposed calculation after calculating KE's electricity sale-purchase data for November 2022.

In a few days, the regulator will issue its final judgment to incorporate these decisions in the consumer billings for January 2023. 

This adjustment/relief would be available to all user categories of KE except lifeline power consumers, domestic consumers consuming up to 300 units, agricultural consumers, and electric vehicle charging stations (EVCS).

It is the fifth month in a row since July 2022 that the regulator has instructed K-Electric to reimburse the consumers’ specified per-unit charges.

Interestingly, in its earlier decision for October’s FCA, NEPRA had directed the utility to refund Rs2.456 per unit to consumers in their December bills. It was being paid back and had a total impact of Rs4.11 billion on the company.

A spokesperson of the company said, “November’s FCA was lower primarily due to a reduction in the prices of RLNG, furnace oil, and power purchased from CPPA-G (Central Power Purchasing Agency-Guaranteed) by 18%, 15%, and 37%, respectively as compared to September 2022.”

Utilities incur the FCA due to global variations in the fuel prices used to generate electricity and change in the generation mix. Furthermore, consumers also benefit when fuel prices decline compared to the reference month.

Regarding the FCA for September 2022, NEPRA had directed K-Electric to refund Rs5.126/unit to clients in their November bills with an impact of around Rs9 billion on the company.

For August’s FCA, the KE was directed to refund Rs4.8862/unit to consumers in October bills having an impact of around Rs8.5 billion. Likewise, for July 2022’s FCA, the regulator asked the KE to pay back Rs4.117/unit in September 2022 bills.