Power Tariff May Increase Rs1.78 Per Unit

Electricity consumers throughout Pakistan, including those served by K-Electric in Karachi, may soon experience an increase of Rs1.78 per unit in their power tariffs following regulatory proceedings conducted by the National Electric Power Regulatory Authority (NEPRA). The proposed adjustment arises from the January Fuel Price Adjustment (FPA), for which the Central Power Purchasing Agency (CPPA) has formally petitioned recovery.

During the hearing, CPPA presented data indicating that the benchmark fuel cost for January had been calculated at Rs10.39 per unit; however, the actual incurred cost escalated to Rs12.17 per unit. This variance has resulted in a recoverable differential of Rs1.78 per unit. It was further disclosed that approximately 8.76 billion units of electricity were dispatched to consumers during the relevant period.

CPPA attributed the increased fuel expenditure to reduced hydropower generation coupled with heightened electricity demand, necessitating greater reliance on comparatively expensive thermal generation sources. In particular, furnace oil-based plants were reportedly dispatched to manage peak load requirements and maintain grid stability.

Concerns were raised during the proceedings regarding the sustained upward trajectory of electricity pricing. Questions were specifically directed toward the operational justification for utilizing furnace oil-based generation during January, given its higher cost implications. Regulatory members noted that successive monthly and quarterly adjustments have consistently trended upward, contrary to earlier expectations of tariff stabilization.

In response, CPPA maintained that system demand dynamics and peak load management requirements compelled the activation of furnace oil facilities to ensure uninterrupted supply. However, regulatory observations indicated that the primary cost driver behind the requested adjustment remains the elevated generation expense associated with furnace oil usage.

Industrial stakeholders also submitted objections, highlighting the potential erosion of relief measures announced under the Prime Minister’s industrial support framework. They cautioned that continued monthly fuel cost adjustments could materially reduce the effective benefit of the Rs4 per unit relief to nearly half, thereby undermining policy intent. Representatives urged the regulator to balance cost recovery mechanisms with broader economic and consumer protection considerations.

The petition has nationwide applicability. Under prevailing government policy guidelines, any determination issued by NEPRA will extend to consumers of K-Electric as well.

Following conclusion of the hearing, NEPRA reserved its judgment, with a formal decision to be issued in due course.