Power firms demand Rs7.9 increase in tariff.

ISLAMABAD -- The electricity distribution companies have demanded an increase of more than Rs7.96 per unit, to be reflected in the bills of July, due to the high cost of power produced from diesel and furnace oil for May.

The Central Power Purchasing Agency (CPPA) has filed an application to the power sector regulator that the total cost of electricity production from various sources during the month of May was Rs13.8969 per unit.

However, it was Rs7.96 over the benchmark of Rs5.93 per unit set by the National Electric Power Regulatory Authority (Nepra) in terms of fuel adjustment charges.

The CPPA is a market operator facilitating the power market transition from the current single buyer to a competitive market, and among its responsibilities is power procurement on behalf of electricity distribution companies (Discos).

As per the legal requirements, Nepra has called a public hearing on the matter on June 27, and all concerned institutions and citizens have been invited to the hearing to present their point of view, mainly against the demands by the CPPA.

But traditionally, the demands of the CPPA regarding fuel price adjustments are accepted by the regulator, as it is difficult to prove that the high cost of fuel was due to any negligence or mismanagement on the part of the CPPA.

The application filed by the CPPA has highlighted that the most expensive electricity was generated from furnace oil at a rate of Rs33.67 per unit, and the cost of power generated from high-speed diesel (HSD) was Rs30.09 per unit.

While furnace oil and HSD accounted for only 8.99 per cent of total electricity produced in the country, the high cost of regasified liquefied natural gas (RLNG) generation pushed the overall rate in the power basket upwards.

The cost of electricity generated from RLNG was Rs27.92 per...

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