Latest news with #FuelChargesAdjustment
Business Recorder
29-07-2025
- Business
- Business Recorder
Karachi trade bodies urge Nepra to upload KE's May FCA plea on website
ISLAMABAD: Trade associations from Karachi have urged National Electric Power Regulatory Authority (Nepra) to upload K-Electric's Fuel Charges Adjustment (FCA) petition for May 2025 without further delay. In letters addressed to Nepra Registrar, the Bin Qasim Association of Trade and Industry (BQATI), Korangi Association of Trade and Industry (KATI), and Pakistan Tanners Association (PTA) raised concerns over the prolonged unavailability of KE's FCA request. The Associations anticipate a significant negative adjustment in May FCA, which could offer relief to industries struggling with high energy costs. However, the federal government is reportedly aiming to implement a uniform FCA policy across the country — an approach that could delay or reduce the impact of FCA adjustments specific to K-Electric's consumers. FCA: Nepra, Karachi stakeholders oppose PD proposal In April 2025, the Power Division attempted to block KE's FCA adjustment under the pretext of a uniform national FCA policy, despite the absence of formal approval from the Federal Cabinet. Nepra declined to act on the Power Division's request, citing the lack of official government authorization. 'We wish to express concern over the continued non-availability of K-Electric's FCA petition for May 2025 on Nepra's official website. Given the significant impact of monthly FCA adjustments on the cost structure of industrial operations, timely public access to this petition is essential for transparency, stakeholder engagement, and financial planning,' the Associations said in a joint statement. They urged Nepra to upload the petition promptly and schedule the associated public hearing at the earliest opportunity. 'We hope the regulatory process will proceed independently and remain free from external delays or influence, in line with Nepra's statutory role as an autonomous and impartial regulator. Your prompt attention to this matter will be greatly appreciated by the industrial community of Karachi,' the letter stated. This issue is expected to surface during the public hearing on the FCA petitions of power distribution companies (DISCOs) scheduled for July 30, 2025. Copyright Business Recorder, 2025
Express Tribune
10-07-2025
- Business
- Express Tribune
Rs4 tariff relief likely for KE customers
Listen to article Electricity consumers will get a power tariff relief of Rs4.0349 per kWh in the bill for the month of July, according to the decision taken by the National Electric Power Regulatory Authority (Nepra) on Wednesday on a petition moved by the K-Electric (KE). The KE's petition pertained to provisional monthly Fuel Charges Adjustment (FCA) for the month of April 2025, indicating a relief of Rs4.0349 per kWh to be passed on to customers in the metropolis in their monthly bills for July 2025. Fuel charge adjustments are incurred by utilities due to global variations in fuel prices used to generate electricity, and the changes in generation mix. These costs are reflected in the customer bills following Nepra's scrutiny and approval. Customers also benefit from negative FCA in their bills when global fuel prices decrease. Rates charged to customer bills are determined by Nepra and notified by the federal government. As per Nepra decision, the FCA shall be applicable to all the consumer categories except lifeline consumers, domestic protected consumers, electric vehicle charges stations (EVCS), and prepaid electricity consumers of all categories who opted for prepaid tariff. Nepra has provisionally retained an amount of Rs800 million in respect of adjustments on account of partial load, open cycle and degradation curves along with start-up cost pursuant to NEPRA's decision regarding generation tariff for the control period July 2023 onwards from the FCA for April 2025 to be adjusted against the pending claims of KE to ensure that consumers are not burdened at later stage.
Business Recorder
10-07-2025
- Business
- Business Recorder
Nepra okays Rs4.043/kWh negative adjustment for KE, 50 paisa per unit for Discos
ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has approved a negative adjustment of Rs 4.043/kWh for K-Electric (KE) for April 2025 on provisional basis, and negative adjustment of 50 paisa per unit for consumers of Discos for May 2025 under the monthly Fuel Charges Adjustment (FCA) mechanism. The Authority conducted hearings on these matters on June 30, 2025, which was attended by officials from relevant entities and the private sector. On the issue of KE, Power Division on June 27, 2025, again requested to defer the hearing by 15 days as it is experiencing increased workload due to Annual Tariff Rebasing, as well as, finalisation of Annual Budget of FY 2025-26. However, the Authority did not accept the request of the Ministry of Energy (MoE) to again defer the hearing. During the hearing, Power Division reiterated its submissions and again requested to defer the hearing. The MoE stated that the Authority, in the past has been applying FCA's on KE consumers with delay as was done for the period from July 2019 to May 2020 and recently from July 2023 to March 2024. It was also explained that the FCA mechanism of ICE is different from XW Discos and impact of higher FCA references of KE is picked up by the government of Pakistan as subsidy. The MoE further submitted that a subsidy of Rs.125 billion is being provided in base tariff for ICE consumers, to make the base tariff and quarterly adjustments uniform with rest of the country. On the same analogy, KE's FCA needs to be made uniform with rest of the country, for which a summary is being presented before the Cabinet, in order to provide relief to the exchequer. Accordingly, the MoE requested to hold the FCA decision of April 2025 till the time approval of the Cabinet is sought to implement uniform FCA across the country. On inquiry by Member Law regarding the time it would take the MoE to bring policy guidelines for uniformity of FCA across the country, the MoE responded that it would take around 10-15 days before the policy guidelines are finalised and sent to Nepra. Upon inquiry from Member Technical, the MoE clarified that it is a seeking a prospective application of uniform FCA, as FCA for April 2025 would be charged in the billing month of July 2025. The Authority noted that provisional FCA proceedings have been taking place since approx. two years, yet the MoE never objected to the reference FCC of Rs.15.9947/kWh. The proceedings for the FCA of April 2025 were initiated through advertisement of June 12, 2025, and hearing was rescheduled twice, but MoE has not been able to file any policy guidelines/ obtain approval of the Cabinet. Thus, the request of MoE to defer the FCAs is premature in the absence of any formal decision by the Cabinet. Moreover, Nepra Act under Section 31(7) provides that the Authority may, on a monthly basis and not later than a period of seven days, make adjustments in the approved tariff on account of any variations in the fuel charges, although, such timelines are directory in nature and not mandatory. The Nepra Act allows for uniformity in tariff to public sector licensees; however, National Electricity (NE) Policy 2021 provides that additionally, the government may maintain a uniform consumer-end tariff for K-Electric and state-owned distribution companies (even after privatisation) through incorporation of direct/ indirect subsidies. Therefore, it remains to be seen whether, the Nepra Act and other applicable documents allow for the uniformity of FCAs or otherwise. Additionally, the pendency of MLRs does not bar the Authority to proceed with the FCA proceedings, as there is not stay in field. The Authority also understands that definition of Federal Government emanates from Constitution of Pakistan itself which states that Federal Government means Prime Minister and Cabinet as clearly enunciated by the Supreme Court of Pakistan in Mustafa Impex case. As the intervention request is from the MoE itself, which is not a juristic separate person rather an administrative unit of the Federal Government. During the hearing on FCA for Discos, Reihan Javed, a representative of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI), and commentator Aamir Sheikh expressed concerns regarding the Furnace Oil levy. They argued that reliance on RFO-based plants could adversely affect the cost of power on the national grid. Based on the discussion and in light of previous decisions of the Authority, the FCA for each Disco has been worked out individually— accounting for energy purchased from CPPA-G, bilateral contracts (captive power, SPPs), and net metering—as part of each Disco's separate energy basket. However, given that a uniform tariff regime is mandated under the Nepra Act, National Electricity Policy, and National Electricity Plan, the Authority has also calculated a National Average Uniform Monthly FCA to be charged from all Disco consumers. CPPA-G has been directed to ensure inter-Disco settlement of the FCAs calculated for each XW Disco, and the FCA charged from consumers, in order to accurately reflect the energy procurement and cost structure specific to each Disco. The Authority decided that the adjustment will apply to all consumer categories except lifeline consumers, protected consumers, Electric Vehicle Charging Stations (EVCS), and all categories of pre-paid electricity consumers who have opted for the pre-paid tariff. Copyright Business Recorder, 2025
Business Recorder
09-07-2025
- Business
- Business Recorder
NEPRA notifies Rs4 per unit relief for KE under April 2025 FCA
The National Electric Power Regulatory Authority (NEPRA) has issued its decision regarding K-Electric's (KE) petition of provisional monthly Fuel Charges Adjustment (FCA) requested for April 2025, indicating a relief of PKR 4.0349 per kWh. This will be passed on to customers in their July 2025 bills. NEPRA has provisionally retained an amount of PKR 0.8 billion in respect of adjustments on account of partial load, open cycle and degradation curves along with start-up cost pursuant to NEPRA's Decision regarding Generation Tariff for the control period July 2023 onwards from the FCA for April 2025 to be adjusted against the pending claims of KE to ensure that consumers are not burdened at later stage. Fuel charge adjustments are incurred by utilities due to global variations in fuel prices used to generate electricity, and the changes in generation mix. These costs are reflected in customer bills following NEPRA's scrutiny and approval. Blackouts and broken promises: lessons from KE's privatisation — II Customers also benefit from negative FCA in their bills when global fuel prices decrease. Rates charged to customer bills are determined by NEPRA and notified by the Federal Government. As per the Regulatory Authority's decision, the FCA shall be applicable to all the consumer categories except lifeline consumers, domestic protected consumers, Electric Vehicle Charges Stations (EVCS) and prepaid electricity consumers of all categories who opted for prepaid tariff.
Business Recorder
30-06-2025
- Business
- Business Recorder
Karachi bearing brunt as ministry looks to block FCA relief yet again
The National Electric Power Regulatory Authority (NEPRA) concluded its public hearing on K-Electric's (KE) petition for the approval of its April 2025 Fuel Charges Adjustment (FCA) to pass on a relief of over PKR 7 billion to Karachi's consumers. The hearing, which was originally deferred at the behest of the Power Division, covered the legal aspect of the Ministry of Energy's (MoE) request to defer the decision on KE's April FCA in light of their pending submission to the Cabinet – requesting application of uniform FCA across the country. The Power Division sought another deferral – submitted on June 27, 2025 – which NEPRA declined and decided to hear KE's case in the public forum. The MoE highlighted that based on its submission to the Cabinet on approving application of uniform FCA across the country, NEPRA should withhold and defer the decision until the Cabinet's decision. They argued that the discrepancy between KE's relief of PKR 4.69 to consumers conflicts with the XWDISCO of PKR 0.93 and would strain the federal budget. Their argument claimed that just as the Quarterly Tariff Adjustment (QTA) is applied uniformly across Pakistan, the FCA should follow the same principle. NEPRA's said the legal stance highlighted that the FCA mechanism is clearly defined in the law, and any unwarranted delays would not be legally sustainable. Moreover, retrospective applications of FCA would be legally indefensible and would likely face legal challenges. NEPRA also highlighted that the MoE's inability to raise this issue earlier or explicitly ask for a stay order in their review of the recently approved Multi-Year Tariff for KE, has put them in a difficult position to justify any delayed decision. Karachi's industrialists echoed this concern, urging NEPRA to remain independent and resist any pressure from the Ministry. They pointed out that the Ministry never objected when Karachi used to pay for positive FCAs in the past, which increased the applicable electricity price while customers of DISCOs enjoyed relief through negative FCAs. Citing a decision from IMF's May 2025 brief, Rehan Javed – a prominent industrialist – shared that IMF instructions specifically required Pakistan to implement timely adjustments in the power sector to manage the country's circular debt. Delays in FCA decisions, whether positive or negative would risk undermining this objective. Echoing similar sentiments, Tanveer Barry, Karachi Chamber of Commerce representative, and Arif Bilvani, prominent industrialist, highlighted what they termed the continued economic discrimination against Karachi. They questioned why Karachi consumers are forced to pay the Power Holding Limited (PHL) surcharge of Rs3.23 per unit of electricity despite contributing nothing to the circular debt for the next six years. They argued that Karachi consumers should now fully benefit from the negative FCA instead of being selectively targeted. They also raised concerns about the government's selective application of the 'Apna Meter, Apni Reading' program, which has not been extended to Karachi. Concluding the session, Amina Ahmed, Member (Law), summarizing the frustration of many, questioned why the Ministry's sudden urgency should override a process that has been place for nearly two years – in reference to KE's reference fuel cost of PKR 15.99. 'Its like the ministry has woken from its slumber,' she remarked. She also mentioned the absence of clear FCA guidelines – similar to QTA guidelines - and asked if it is imprudent to put Karachi's consumers on hold on the basis of an already delayed Cabinet approval – which may or may not implement a uniform FCA regime. Speaking during the hearing, Moonis Alvi, CEO KE, shared that they trust NEPRA's process in upholding fairness in whatever decision they may pass and that KE will abide by the decision notified as per the Authority.
