Nepra issues pending notifications for KE tariffs
Previously, the federal government was responsible for issuing tariff notifications. However, amid prolonged delays and under pressure from the International Monetary Fund (IMF) and the World Bank, the law was amended in 2021, granting NEPRA the authority to notify tariffs directly.
'It is now the duty of the Authority to issue the requisite notifications of its determinations if the government fails to do so or if any reconsideration request remains pending,' official sources said. Under Rule 31 of the NEPRA Act, the Authority can issue such notifications if the federal government does not act within the specified time.
DISCOs and KE: Nepra approves revised average uniform SoT
Although the government's review motion is still under consideration, NEPRA clarified that if it revises its previous determinations, the tariffs will be amended accordingly.
In a related development, Deputy Prime Minister and Foreign Minister Ishaq Dar recently chaired a high-level, confidential meeting to discuss KE's ownership issues involving Al-Jomaih, following a strongly worded letter from Pakistan's Ambassador to Saudi Arabia.
KE's average power supply tariff has been fixed Rs 39.97 / kWh which includes power purchase excluding transmission cost of Rs 31.96 per unit, transmission cost of Rs 2.86 per unit, distribution cost Rs 3.31 per unit, supply margin Rs 2.28 per unit and Prior Year Adjustment negative Rs 0.44 per unit.
The power utility company's total revenue requirement is estimated to be Rs 606.920 billion, for FY 2023-24, of which supply margin will be Rs 34.681 billion, O&M cost Rs 5.91 billion, working capital negative Rs 1.244 billion, recovery loss, Rs 36.253 billion, gross margin Rs 40.921 billion, other income negative Rs 6.240 billion, net margin Rs 34.681 billion and prior year adjustment negative Rs 6.690 billion.
The Authority also considering the fact that FY 2023-24 has already lapsed and FY 2024-25 is almost 11 months gone, also obtained ICE's actual recovery ratios for the FY 2023-24 and FY 2024-25. As submitted by KE its actual recovery for the FY 2023-24 remained at 91.50%, whereas FY 2024-25 is expected to close at 90.50%.
The financial impact of under recovery of 8.50% for FY 2023-24 and 9.50% for FY 2024-25, as reported by KE, is around Rs.40 billion and Rs.57 billion respectively.
The Authority noted that return allowed to KE for its distribution function is around Rs.21.6 billion, meaning thereby that effectively KE would be incurring losses for the first 02 years of MYT, if no recovery loss is allowed to KE. This may compromise the financial viability of the company, which is neither in the interest of the consumers nor power system as whole.
In another notification NEPRA has approved distribution tariff of Rs 3.31/ kWh and Rs 2.684 / kWh for investment of Rs 43.447 billion during the validity of MYT.
Copyright Business Recorder, 2025
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
4 hours ago
- Business Recorder
‘Agri development, farmer prosperity are top priorities of CM'
LAHORE: Minister for Agriculture Punjab, Syed Ashiq Hussain Kirmani, has stated that agricultural development and farmer prosperity are among the foremost priorities of the Chief Minister Punjab. The present government is implementing revolutionary programs aimed at uplifting the agriculture sector and ensuring farmer welfare, which have already begun yielding positive outcomes across the province. However, some elements are attempting to distort the facts and spread misconceptions regarding these historic initiatives of the Punjab government. Minister Syed Ashiq Hussain Kirmani highlighted that within just one month of taking office, the Chief Minister Punjab initiated multiple agricultural development programs worth Rs. 400 billion — f or the first time in the history of Province. These programs included interest-free loans worth of billions of rupees through Kisan Card, provision of thousands of tractors on subsidy under the Green Tractors Program, and provision of modern agricultural machinery with up to 60% subsidy and many other initiatives. He added that this is the only Government in Pakistan's history during which no fertilizer shortage has been witnessed. Fertilizer is available in abundance in the market at prices even lower than those fixed by the manufacturers. Artificial shortages, profiteering, and hoarding of fertilizers have been completely eradicated from the province. He clarified that, during the current season, all provincial governments ceased official wheat procurement under the IMF agreement; however, Punjab remains the only province that extended direct financial support of Rs. 14 billion to small wheat farmers. During just a short period of two months, more than Rs. 85 billion in interest-free loans have been disbursed to farmers across Punjab for the purchase of fertilizers, seeds, and pesticides for Kharif crops. Of this amount, farmers have already utilized over Rs. 45 billion for the purchase of fertilizers, pesticides, and diesel. Syed Ashiq Hussain Kirmani further elaborated on the landmark programs launched during the current fiscal year for the welfare of farmers and agricultural advancement. These include Rs. 200 billion in interest-free loans through the Kisan Card, subsidized provision of 20,000 tractors, solarization of over 10,000 agricultural tube wells, establishment of 10 model agriculture malls, recruitment of 2,000 young agriculture graduates to provide technical support in the field, improvement and lining of watercourses, and a Rs. 30 billion program for the distribution of modern agricultural machinery. Copyright Business Recorder, 2025
Business Recorder
5 hours ago
- Business Recorder
Working in silos will not do
EDITORIAL: The energy sector's complex web is becoming increasingly difficult to manage as authorities continue to attempt to solve issues in silos, an approach that only complicates the problems. Currently, the Energy Task Force (ETF) and the Power and Petroleum Divisions are developing their own solutions without considering their interconnectivity and interdependence. With the power sector's push, backed by the IMF, captive power plants are being subjected to hefty levies on gas consumption. The objective is to transition industrial consumers to the grid, which is being partially achieved. The logical consequence should have been a higher off-take of RLNG by the power sector, but that is not happening, leaving expensive gas unused, which contributes to the circular debt of gas, excessive pressure on the pipelines, and lower off-take of cheap domestic gas. Reportedly, when the Petroleum Division urged the Power Division to increase its intake of RLNG, the minister replied that it would not commit a grave sin (gunnah-e-kabeera) by violating the economic merit order (EMO). The minister was behaving like a principled man, but such discipline was regrettably found lacking when the levy imposed (at peak rates for the entire day) was even higher than what the IMF had prescribed. The Discos (working under the Power Division) are being blamed for Rs 240 billion of overbilling to poor consumers, who are already paying for the inefficiencies of the government. The minister is silent on this issue that is beginning to become increasingly conspicuous. This selective amnesia does not stop here. The power minister is pushing his petroleum counterpart to review RLNG buying contracts with Qatar, asking to emulate what the Power Division has done with the IPPs. How naïve is it to even suggest this remedy. First, it would be tantamount to openly disregarding the sanctity of sovereign contracts. Second, it tends to advocate and normalise coercive actions that were employed against local IPP owners, a stance that has severely undermined investor confidence. Third, it demands breaking contractual commitments with international investors, despite the Power Division and ETF's own failures — even they could not persuade Chinese IPPs to waive the late payment interest (LPI) on outstanding dues, casting uncertainty over the Rs 1.3 trillion circular debt reduction plan. And the cherry on the top is that EMO that is being termed 'holy' while others are being advised to violate (or revise) sovereign contracts. Not only is buying RLNG from Qatar a necessity, but running RLNG plants to a specific limit is also necessary. It is a problem of double standards and a lack of understanding of the core issues. What the government is required to focus on is why the power demand is falling, as the off-take from the grid is still 11 percent shy of its peak in FY22. The need is to address the issue of solar net metering — where rates should be revised by adjusting solar pricing for new net metering contracts (with no change in existing rates) — has been identified, yet the necessary action has not been taken. The power ministry fears a public backlash over solar net metering, while the public is being cheated by entities under its domain by engaging in overbilling at the same time. Suffice it to say that the direly needed clarity of thought and objectivity in the solutions being proposed are simply missing. Copyright Business Recorder, 2025
Business Recorder
5 hours ago
- Business Recorder
Diplomatic, official passport holders: UAE activates visa waiver, says Dar
ISLAMABAD: Foreign Minister Ishaq Dar on Sunday announced that the United Arab Emirates (UAE) has formally implemented a visa exemption facility for holders of Pakistani diplomatic and official passports, effective from July 25, 2025. Dar, who is currently in the US, in a post shared on X, stated that the visa waiver was agreed upon during a bilateral meeting with UAE Deputy Prime Minister and Minister of Foreign Affairs Sheikh Abdullah bin Zayed Al Nahyan, held in Abu Dhabi on June 24, 2025. The meeting culminated in the signing of a memorandum of understanding (MoU), outlining mutual visa exemptions for diplomatic and official passport holders of both countries. Pakistan, UAE sign visa exemption agreement for select passport holders 'The MoU, which both sides signed to formalise the exemption, was to take effect 30 days from the date of signature,' Dar said. He confirmed that UAE authorities have now operationalised the agreement, allowing Pakistani diplomatic and official passport holders to enter the UAE without requiring a visa. The facility has been made applicable across all UAE ports of entry as of July 25, 2025. Furthermore, Dar noted that reciprocal arrangements have also been extended to UAE nationals. 'Holders of UAE diplomatic and official passports will now be able to avail visa-free entry at all Pakistani airports,' he added. At the same time, sections of the public criticised Prime Minister Shehbaz Sharif Administration for turning a blind eye to the increasingly stringent visa restrictions imposed by the UAE on ordinary Pakistani citizens, particularly labourers, while extending facilitation to VIPs. They pointed out that those who contribute to the national economy through remittances earned by hard labour abroad are left without institutional support, even as the authorities go out of their way to ease travel for officials and privileged individuals - who can now enter the UAE without a visa. Critics argued that the government must show equal concern for the working class, whose mobility is increasingly constrained despite their significant economic contributions. Copyright Business Recorder, 2025
