Federal Minister for Power Khurram Dastgir on Tuesday said the federal cabinet had decided to increase the power tariff by Rs3.50 per unit with immediate effect and issued special directives to the Ministry of Power for protecting the poor consumers from its impact.
Addressing a press conference flanked by Minister of State for Petroleum Musadik Malik, Dastgir said that a Rs3.50 per unit hike in the tariff would be applicable from July 26, while another Rs3.50 per unit increase would be applied to the bill from the next month and Rs0.90 from October.
He said the first three months would be difficult for the consumers but the power prices would start decreasing from November after reflection of the fuel surcharge in the tariff.
The hike would have no such impact on the consumers as the increase had already been reflected in the monthly bills on account of fuel price adjustment, the power minister added.
Dastgir said the cabinet had also decided to provide a smooth and uninterrupted power supply round the clock to the dedicated industrial feeders to protect the livelihoods of the people.
Similarly, minimum load-management would be carried out on mix-industrial feeders, he said, adding that it was also decided to provide both gas and electricity on a priority basis to five major export sectors at reduced rates.
An announcement to this effect would be made soon, he added.
Regarding a significant increase in the power generation, he said that it has massively jumped owing to increase hydel generation from Tarbela and resumption of 1,100 MW from nuclear power plant K-2. Currently, hydel generation from Tarbela stood at 4500 MW, he added.
Speaking on the occasion, Malik expressed confidence that the electricity price would start decreasing from October-November due to the effective policies of the coalition government.
Malik added that there would be a visible gradual reduction in the electricity price in the coming three-four months.
Explaining the phenomenon of “rebasing”, the minister said it was the basic production cost of electricity that included the fuel rate, losses, and other expenses faced in transmitting power to consumers.
“There are two basic components of the rebasing (revised tariff]; which include production and transmission cost.”
As per the law, he said, the revision was a regular process, but the PTI government after February 2021 did not carry out the rebasing. “Non-rebasing does not mean that you [consumers) did not pay the price. Rebasing means to just make an announcement, as the current government has done today [instead of using fuel adjustment tool],” he said.
The petroleum minister said the previous government was in the practice of non-announcement of the rebasing but continued increasing the price on account of fuel adjustment and quarter tariff adjustment in electricity bills.
Answering a question, the petroleum minister said the country’s indigenous gas deposits were depleting at the rate of 10% annually, causing a shortage of the commodity, especially during the peak winter season.
On the network of Sui Northern Gas Pipelines Limited alone, he said, around 780 Metric Million Cubic Feet per Day (MMCFD) of gas was available against the average winter demand of 1,150 MMCFD of domestic consumers in Punjab and Khyber Pakhtunkhwa only.
He said the government was in process of devising an effective strategy and exploring all possible means to meet the upcoming peak winter needs of gas consumers.
It may be mentioned here that the Central Power Purchasing Agency (CPPA-G) sought a Rs9.90 per unit increase in power tariff for June for XWDISCOs under the monthly Fuel Cost Adjustment (FCA) mechanism.
According to the petition submitted to National Electric Power Regulatory Authority (NEPRA), the CPPA-G maintained that the actual cost remained Rs15.8439 per unit against the reference fuel charges of Rs5.9344 per unit during June.
A total of 13,876.14 GWh of electricity was generated worth Rs204.237 billion during the said period while 13,471.05 GWh of net electricity was supplied to the power distribution companies (DISCOs).
Out of total generation, as many as 24.22 per cent of electricity was generated from hydel, 13.57 per cent coal, 10.48 per cent furnace oil, 10.68 per cent local gas, 24.43 per cent RLNG, 9.12 per cent nuclear and 5.85 per cent wind. The regulator will hold a public hearing on July 28. The impact of the proposed increase will be passed on to all categories of consumers except lifeline.
