ISLAMABAD: As the National Electric Power Regulatory Authority (Nepra) finished its public hearing on month-to-month gas price modifications (FCA) and also quarterly toll modifications (QTA) for about nine months, the K-Electric has advised that non availability of required gas quantities can create power lacks in Karachi during peak summertimes.
The regulator was examining KE’s requests for increase in electrical power rates on account of fuel cost adjustments for seven months and quarterly changes for nine months involving an accumulated extra earnings generation of about Rs40 billion.
A KE official clarified that month-to-month FCA ask for June 2020 to December 2020 amount to about Rs3.9 bn. Of this depending upon Nepra authorization, Rs3.2 bn will certainly be handed down to customers and continuing to be will certainly become part of quarterly adjustments as per the provided system for transmission as well as circulation (T&D) losses and non-passing of adverse FCA to specific customer classifications.
On the basis of QTA, the KE will certainly be able to file its Toll Differential Insurance Claims of regarding Rs39bn for July 2020 to March 2021 after resolution by the regulatory authority.
All these adjustments have actually been sought on the basis of previous petitions on which the regulatory authority had actually carried out public hearings in September in 2015 for duration up to March 2020 but a final resolution is still pending.
The KE advised the power regulatory authority that its previous modifications of over Rs119bn were still superior, triggering cash flow troubles to power utility which required to be resolved at the earliest.
Nepra criticises KE
Throughout the hearing, Nepra chairman Tauseef H. Farooqui criticised KE for not adhering to the quality order in the operations of the power plants. But the KE team described that the power company strictly complied with the advantage order to the maximum level but it was obliged to utilize pricey gas when it encountered gas pressure problem as well as power need from the customers had to be satisfied at any cost to prevent public anguishes.
During the hearing, the chairman alerted the KE of consequences if individuals of Karachi experienced loadshedding in summer.
Nevertheless, the KE team reported that initial device of the 900MW new Container Qasim Power Plant would certainly be ready by May 15 to create about 450MW however severe trouble might develop due to poor gas products as the Sui Southern Gas Business (SSGC) was not all set to sign a gas supply contract regardless of best shots by KE.
About reduction in tariff on account of quarterly changes, the negative change in April to June 2020 was mostly attributable to reduced fuel prices which dropped due to Covid-19, followed by a steady rise in the second fifty percent of the year. Furnace oil costs additionally dropped from Rs57,000 per tonne in March 2020 to Rs35,000 per tonne in Might 2020 and after that boosted to Rs55,000 per tonne throughout July to December 2020.
Likewise, RLNG prices went down from Rs1,800 per MMBTU in March 2020 to Rs1,040 per MMBTU in June 2020 and afterwards enhanced to Rs1,300 per MMBTU in Dec 2020.
It was discussed that variants in QTAs would not influence the consumers negatively owing to the government plan of consistent customer toll across the nation. However, these amounts would certainly be payable to KE via toll differential aid from the federal government.