ECC to take up K-Electric tariff increase today.

Byline: Khaleeq Kiani

ISLAMABAD -- With the beginning of the new fiscal year, the government has called a meeting of the Economic Coordination Committee (ECC) of the Cabinet to settle two crucial decisions - an immediate increase of Rs2.39 per unit in electricity tariff for K-Electric customers and adjustment of Rs73 billion cost of imported re-gasified liquefied natural gas (RLNG) in gas consumers tariff.

To be presided over by Finance Adviser Dr Abdul Hafeez Shaikh, the meeting is also expected to consider urea fertiliser availability for FY21 and provision of subsidy to two fertiliser plants - Agritech and Fatima Fertiliser - and approve National Telecommunication Corporation revised budget for 2019-20 and Budget Estimates for 2020-21.

Informed sources said the question of increase in electricity rates for Karachi consumers had become quite complex and the Power Division had proposed two solutions to the ECC. The issue pertains to settlement of previous quarterly adjustments for KE for almost four years, necessitating about a Rs4.88 per unit average raise.

Given such a sudden shock in one go, the Power Division has proposed passing on Rs2.39 per unit average increase with immediate effect to bring KE at par with uniform national tariff currently applicable for all the distribution companies of ex-Wapda. That would mean about Rs1.09-Rs2.90 per unit increase for different consumer categories. At present, the KE tariff is lower than national and this has been going on for about 18 months.

Secondly, the Power Division has suggested that the remaining part of about Rs2.59 per unit should be sent back to the National Electric Power Regulatory Authority (Nepra) to be dealt with under Prior Year Adjustment (PYA) mechanism for gradually making part of the base tariff.

According to informed sources, the Karachi-based power utility had been lobbying for settlement of entire...