ISLAMABAD: The Central Power Purchasing Agency- Guaranteed (CPPA-G) has requested an increase of Rs 3.12 per unit in the tariffs of the electricity distribution companies (Discos) for December 2021, under the monthly adjustment mechanism of the fuel component (FCA), as generation from coal has overtaken generation from hydel in terms of units and cost.
According to CAPP-G, the primary reason for the proposed FCA increase was higher production from expensive fuels and previous adjustments. The impact of the approved increase will be passed on to all categories of Discos consumers, with the exception of vital consumers. It will also affect KE consumers as 1100-1300MW will be purchased from the national grid.
The regulator will hold a public hearing on February 1, 2022 to seek justifications from CAPP-G, NTDC and other relevant organizations regarding the proposed increase. According to data submitted to Nepra, in December 2021 hydel production was reduced to 1,769 GWh due to the annual canal closure of 2,816.49 GWh in November 2021, constituting 20.04% from 33.21 % of total production for the whole month of November.
Fuel Component Adjustment: CPPA-G Requests Rs 4.33 Increase in Discos Fares for November
The Nepra team did not mention the average cost of generating hydel despite being repeatedly asked by the Authority to include it in the FCA figures. Electricity production from coal-fired power plants was 2,104 GWh in December compared to 1,379 GWh in November, showing an increase of nearly 53% for the month as a whole.
It also shows that coal production accounted for 23.83% of total production in December 2021, compared to 16.26% in November. The price of coal production was 13.3122 rupees per unit in December 2021.
HSD production was recorded at 251 GWh (2.84%) at 14.0862 rupees per unit. RFO’s production was 353 GWh (4% of total production) at Rs 22.2446 per unit.
Copyright Business Recorder, 2022