Electricity Prices Rise with New Fuel Adjustment Charges

Power consumers across Pakistan are expected to face an additional financial burden following the notification of a positive Fuel Charges Adjustment (FCA) by the National Electric Power Regulatory Authority (NEPRA) amounting to Rs1.42 per unit for February 2026.

The regulator has authorized both distribution companies (DISCOs) and K-Electric to recover approximately Rs10.55 billion from consumers through forthcoming electricity bills, exclusive of applicable taxes.

As per NEPRA’s determination, the actual national average uniform Fuel Charges Component (FCC) for February 2026 was recorded at Rs8.1573 per kWh, as compared to the reference FCC of Rs6.7337 per kWh. This differential has resulted in a net upward FCA adjustment of Rs1.4235 per unit for the said period.

The additional charges are scheduled to be incorporated into electricity bills issued in April 2026 and will apply to all categories of consumers served by DISCOs and K-Electric, with the exception of lifeline consumers, Electric Vehicle Charging Stations (EVCS), and prepaid consumers who have opted for prepaid tariff structures. The FCA will also extend to consumers covered under the Incremental Consumption Package.

The determination follows a public hearing conducted on March 31, 2026, with participation from the Central Power Purchasing Agency (Guaranteed), the Power Planning and Monitoring Company, and the Independent System and Market Operator. It is noted that CPPA-G had initially proposed a higher adjustment of Rs1.64 per unit.

Supporting data indicates that electricity generation from hydropower sources declined by 5.3% to 1,783 GWh in February 2026, compared to 1,883 GWh in the corresponding period of the previous year. Generation from gas-based power plants also decreased to 887 GWh, constituting 11.52% of total generation, at a cost of Rs12.7439 per unit.

Conversely, electricity generation from imported coal experienced a substantial increase, rising to 1,150 GWh (14.95% of total generation) from 108 GWh in February 2025, reflecting a surge of approximately 965%, with a generation cost of Rs13.5605 per unit. Similarly, generation from local coal increased to 1,231 GWh (15.99% of total generation) at a cost of Rs12.2193 per unit. No generation was recorded from residual fuel oil (RFO) or high-speed diesel (HSD) during the period under review.

Generation from re-gasified liquefied natural gas (RLNG) declined by 25.6% to 729 GWh (9.47% of total generation) at a cost of Rs20.1613 per unit. Nuclear energy output also decreased by 21% to 1,449 GWh (18.83% of total generation), albeit at a significantly lower cost of Rs2.5042 per unit.

Electricity imports from Iran increased marginally to 35 GWh at a cost of Rs23.2107 per unit. Overall, total electricity generation for February 2026 was recorded at 7,696 GWh, with an average cost of Rs8.1543 per unit.

The CPPA-G has additionally sought approval for a prior period adjustment amounting to Rs694 million. Sales to independent power producers were recorded at negative 24 GWh at a cost of Rs51.9007 per unit, while transmission losses stood at 244 GWh, representing 3.18% of total generation. Net electricity supplied to distribution companies amounted to 7,427 GWh at an average cost of Rs8.3743 per unit.