No hike in KE rates as tariff adjustment delayed

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Staff Reporter The federal cabinet’s Economic Coordination Committee has delayed its decision on the Quarterly Tariff Adjustment for K-Electric and formed a committee to submit a report within a week for further review. On December 31, the National Electric Power Regulatory Authority (NEPRA) had issued a notification proposing an increase of Rs4.87 per unit in electricity price for KE. In a meeting on Wednesday, the top-level government body on economic decisions reviewed NEPRA’s recommendation and decided to defer any increase for now. The committee, which will include federal ministers Hammad Azhar (Economic Affairs) and Omar Ayub (Energy), will submit its report in a week and the matter will be reviewed again by the ECC. This adjustment is on account of variation in power purchase price, inflation, operations and maintenance costs, rupee devaluation, transmission and distribution losses, write-offs and increased fuel costs over a month or a quarter. However, unlike fuel charges adjustment, which is fully paid by customers, the quarterly adjustment amount is usually settled at the government level. Under Quarterly Tariff Adjustment, KE will be able to recover Rs106 billion at Rs4.87 per unit. It is up to the government to decide whether it absorbs all of it or passes some of this increase onto the consumers. The adjustments were delayed because the government didn’t finalise KE’s multi-year tariff. , which locks the rate for seven years. Power distribution companies can’t increase price on their own because electricity prices are regulated by the government under a multi-year tariff.

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