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CPPA requests NEPRA to reduce Rs 3.20 per unit in power charges

CPPA requests NEPRA to reduce Rs 3.20 per unit in power charges

ISLAMABAD: The Central Power Purchase Agency (CPPA) requested the National Electric Power Regulatory Authority (Nepra) to decrease electricity charges for a month by Rs3.2 per unit as the international prices of fuel are declining.
Nepra has admitted the request for formal hearing. The reduction, if approved, will be applicable to all distribution companies except K-Electric. The relief will be given to consumers in the billing month of February.
The CPPA said Nepra had approved reference fuel tariff of about Rs9.53 per unit last year when furnace oil price stood at Rs75,000 per ton. The price has since come down to a little over Rs40,000. As a result, the actual fuel cost has declined to Rs6.32 per unit, requiring a reduction of Rs3.2 per unit.
On top of that, the power sector’s reliance on furnace oil dropped significantly because of limited supplies in the wake of the Pakistan State Oil’s inability to import fuel as banks cancelled credit lines due to huge receivables.
Therefore, the water and power ministry followed the policy of increasing loadshedding. As a consequence, many power plants remained idle and the monthly fuel price component of the tariff declined considerably.
The CPPA said the diesel-based cost stood at Rs19 per unit, furnace oil-based cost at Rs12.38, gas-based cost at Rs3.57, nuclear energy-based cost at Rs1.18 and electricity imported from Iran cost Rs10.2, resulting in a saving of Rs20 billion during December.
Nepra had approved Rs2.97 per unit reduction in the fuel price adjustment for November, but the government had imposed an equalisation surcharge of 60 paisa per unit and passed on to consumers relief of only Rs2.36 per unit.