Latest news with #AwaisKhanLeghari
Business Recorder
3 days ago
- Business
- Business Recorder
Nepra's decisions on KE tariffs: Power Div. flags potential consumers harm, urges revision
ISLAMABAD: The Power Division on Wednesday announced plans to file reviews of the National Electric Power Regulatory Authority's recent decisions regarding K-Electric tariffs, warning that parts of the rulings could have negative consequences for consumers if not revised. Power Minister Sardar Awais Khan Leghari took to X (formerly Twitter) to express concerns about Nepra's decisions announced during the last few days that have drawn strong reactions from the ministry. The minister's remarks came at a time when Nepra, which by law is the power sector regulator, feels helpless in implementing its directions issued to Power Division and its affiliated organizations. NEPRA approves K-Electric's MYT for supply segment Last month, during a public hearing on IEECO's Multi-Year Tariff petition , Member (Tech) Rafique Ahmad Shaikh, asked Power Division to get rid of Chief Executive Officer (CEO), for poor performance. Similar positions were seen in other Discos and NTDC, which irritated the Authority during public hearings. 'The Ministry has serious concerns regarding Nepra's multiple determinations related to K-Electric's licenses for generation, transmission, distribution, and supply. These decisions also impact the investment plan for the upcoming multi-year tariff period,' said the Power Minister. Leghari emphasized that the rulings have significant long-term implications for consumer tariffs and the Federal Government's subsidy framework under the uniform tariff regime. 'The ministry is preparing to seek a review of the recent determinations concerning transmission, distribution, and supply. Additionally, the reconsideration of an earlier generation tariff decision — submitted back in December 2024—still awaits Nepra's attention. This delay poses serious financial risks for the power sector and its associated subsidies,' he added. The minister further cautioned that unresolved issues within Nepra's rulings could negatively affect consumers and the broader regulatory environment, potentially deterring private sector investment in the distribution sector. According to a power sector expert, Nepra's annual recovery loss allowance of Rs 40 billion granted to K-Electric—totaling over Rs 320 billion across seven years. Another insider sarcastically stated that 'Minister seems super happy on Nepra's determinations'. Another expert stated that real challenge is rampant power theft and non-recovery of electricity bills in the country. On the governance side, however, the proposed bill to classify electricity theft as a criminal offense was recently rejected by lawmakers. As a result, Discos are left with no option but to recover their legitimate business costs from paying consumers — a practice observed across the country. Power Division wants to review Nepra's recent tariff determinations for K-Electric, consumers across Pakistan, including those in Karachi, already burdened with the PHL surcharge due to the continued non-recovery of dues from other government-owned Discos. The Nepra's determinations on KE Multi-Year Tariff petitions are actually removing such disparities currently present in Pakistan's power sector. Also, unlike KE previous multiyear tariff for 2017-23, there is a periodic review mechanism built in the tariff for the period 2023-30. Copyright Business Recorder, 2025
Business Recorder
3 days ago
- Business
- Business Recorder
Nepra's decisions on KE tariffs: PD flags potential consumers harm, urges revision
ISLAMABAD: The Power Division on Wednesday announced plans to file reviews of the National Electric Power Regulatory Authority's recent decisions regarding K-Electric tariffs, warning that parts of the rulings could have negative consequences for consumers if not revised. Power Minister Sardar Awais Khan Leghari took to X (formerly Twitter) to express concerns about Nepra's decisions announced during the last few days that have drawn strong reactions from the ministry. The minister's remarks came at a time when Nepra, which by law is the power sector regulator, feels helpless in implementing its directions issued to Power Division and its affiliated organizations. NEPRA approves K-Electric's MYT for supply segment Last month, during a public hearing on IEECO's Multi-Year Tariff petition , Member (Tech) Rafique Ahmad Shaikh, asked Power Division to get rid of Chief Executive Officer (CEO), for poor performance. Similar positions were seen in other Discos and NTDC, which irritated the Authority during public hearings. 'The Ministry has serious concerns regarding Nepra's multiple determinations related to K-Electric's licenses for generation, transmission, distribution, and supply. These decisions also impact the investment plan for the upcoming multi-year tariff period,' said the Power Minister. Leghari emphasized that the rulings have significant long-term implications for consumer tariffs and the Federal Government's subsidy framework under the uniform tariff regime. 'The ministry is preparing to seek a review of the recent determinations concerning transmission, distribution, and supply. Additionally, the reconsideration of an earlier generation tariff decision — submitted back in December 2024—still awaits Nepra's attention. This delay poses serious financial risks for the power sector and its associated subsidies,' he added. The minister further cautioned that unresolved issues within Nepra's rulings could negatively affect consumers and the broader regulatory environment, potentially deterring private sector investment in the distribution sector. According to a power sector expert, Nepra's annual recovery loss allowance of Rs 40 billion granted to K-Electric—totaling over Rs 320 billion across seven years. Another insider sarcastically stated that 'Minister seems super happy on Nepra's determinations'. Another expert stated that real challenge is rampant power theft and non-recovery of electricity bills in the country. On the governance side, however, the proposed bill to classify electricity theft as a criminal offense was recently rejected by lawmakers. As a result, Discos are left with no option but to recover their legitimate business costs from paying consumers — a practice observed across the country. Power Division wants to review Nepra's recent tariff determinations for K-Electric, consumers across Pakistan, including those in Karachi, already burdened with the PHL surcharge due to the continued non-recovery of dues from other government-owned Discos. The Nepra's determinations on KE Multi-Year Tariff petitions are actually removing such disparities currently present in Pakistan's power sector. Also, unlike KE previous multiyear tariff for 2017-23, there is a periodic review mechanism built in the tariff for the period 2023-30. Copyright Business Recorder, 2025
Express Tribune
04-04-2025
- Business
- Express Tribune
Govt nears Rs1.34tr loan deal
Minister for Power Sardar Awais Khan Leghari announced on Friday that negotiations with banks for loans amounting to Rs1.34 trillion were in the final stages to reduce the power sector's circular debt, which currently stands at Rs2.4 trillion. Speaking to the media, the minister said that once banks submit their term sheets, agreements would be finalised, which would help reduce Rs300-335 billion in circular debt. The loans will be repaid through the debt servicing surcharge (DSS) of Rs3.23 per unit, with both the current and future governments continuing repayments through this mechanism. The minister also hinted at a further potential reduction in electricity tariffs during the upcoming tariff rebasing in June 2025, but cautioned that fluctuations in fuel prices would continue to be passed on to consumers through the fuel cost adjustment (FCA). "If interest rates increase, or the rupee devalues, it will impact the quarterly tariff adjustment (QTA) as it is subject to fluctuations. Similarly, if dams dry up and hydel generation decreases, or if expensive fuel needs to be purchased or international energy prices rise, these changes will be reflected in the FCA," he explained. However, he assured that the current reduction in electricity prices is based on solid and sustainable grounds. He noted that the termination of independent power producers (IPPs) contracts and the imposition of an additional Rs10 per liter tax on petroleum products have contributed to an approximate Rs4 reduction in the price per unit, a decrease that is expected to be sustainable. He further stressed that the petroleum levy (PL) would not be removed. In response to questions about consumer confusion regarding the impact of price reductions on their bills, the minister clarified that the overall reduction in tariff would amount to Rs 6 per unit, plus a tax of Rs1.50 per unit. This would result in a total reduction of Rs7.44 for domestic consumers and Rs7.69 for industrial consumers. Moreover, savings of Rs2 per unit would be realised from the renegotiation of IPP contracts. The minister also shared that talks with China regarding the reprofiling of debts and the conversion to local coal were progressing smoothly. He indicated that the tariff rebasing in June 2025 could bring further reductions due to the successful implementation of ongoing reforms. "Our reforms are focused on creating a sustainable, long-term reduction mechanism based on efficiency," he added. He further explained that if the tariff reductions had been solely based on renegotiated IPP contracts, the International Monetary Fund (IMF) would not have supported such significant price cuts. According to Leghari, the IMF had stressed the importance of continuous reform processes, which, once shared and explained, helped build confidence in the power sector's path toward sustainability. The minister also revealed that the centralised trading of bulk power market (CTBCM) would be operationalised by the end of the current year. Initially, the government plans to start with a bilateral trade of 800-1000 MW of electricity. "We are optimistic that if our reform process continues at the same pace, we will see significant downward pressure on electricity prices," he said.
