ISLAMABAD: Minister for Power, Sardar Awais Ahmad Khan Leghari, is set to meet with the National Electric Power Regulatory Authority (NEPRA) on Monday (tomorrow), amid speculation that the regulator may reject the government’s review motion concerning the tariff for Karachi Electric (KE). Sources told Newzshewz that ongoing behind-the-scenes discussions between the Power Division and NEPRA are intensifying after indications that NEPRA might dismiss the motion on the grounds that it is time-barred.
At recent meeting of Executive Committee on Special Investment Facilitation Council (SIFC), Power Division has been directed to share the input on KE’s MYTs. NEPRA to issue the determination on KE’s Write Off Claims & MYTs, incorporating recommendations / input by Power Division &
Power Task Force by January 5, 2025.
The Power Division’s review motion has raised concerns about NEPRA’s decision on KE’s seven-year (Multi-Year Tariff), arguing that the tariff hike would impose an unfair financial burden on consumers. The Power Division has called for a reduction in the approved tariff from Rs 44.69 per unit to Rs 34.87 per unit, a cut of almost Rs 10 per unit.
At a press conference on December 28, 2024, Minister Leghari stated that KE had sought an unjustifiable rate from the regulator. “KE sought a rate for the upcoming years, which we thoroughly analyzed before presenting it to the public and sending it to the regulator. Whether the regulator accepts or rejects our proposal is up to them, but this proposed rate is unaffordable for the people of Karachi and Pakistan. The burden will fall on them, and it may not be justifiable,” he said.
The minister further emphasized that if NEPRA makes the right decision, the people of Karachi and Pakistan could save several hundred billion rupees over the next seven years. He stressed that NEPRA is meant to protect consumer interests, something he claimed has not always been the case in the past. Leghari also questioned who would bear the consequences of NEPRA’s decisions, particularly regarding past decisions made during the privatization of distribution companies (Discos).
The Power Division has already begun reviewing NEPRA’s past decisions, particularly concerning Independent Power Producers (IPPs), and is preparing for a potential forensic audit of one power plant, as indicated by a recent public advertisement.
Additionally, the issue of guidelines on net metering is expected to come up in the meeting. The proposed changes to NEPRA’s regulations could exempt renewable energy projects established by foreign entities under the Inter-Governmental Commercial Transactions (IGCT) Act, 2022. The amendments would also exempt projects deemed “least-cost” under the Integrated Generation Capacity Expansion Plan (IGCEP) 2021. However, the minister has made it clear that these amendments are not acceptable to the government and will be scrapped.
Power Minister, Awais Leghari who has been given free hand by the Prime Minister, Shehbaz Sharif, also wants reforms in NEPRA so that it could take right decisions in the best interest of people and the energy sector.
Power Division to share the input on KE’s MYTs.
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