ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has directed the Power Division to submit a comprehensive power generation plan in light of a projected sharp decline in hydel power output, following warnings from the National Power Control Centre (NPCC) of an unfavorable summer ahead.
The directive was issued during a public hearing on the Fuel Charges Adjustment (FCA) for February 2025, where the Central Power Purchasing Agency (CPPA-G) proposed a negative adjustment of 30 paisa per unit across all consumer categories. However, given that January 2025’s FCA adjustment of Rs 2.124 per unit was applied in March bills, replacing it with a negative adjustment of just Rs 0.30 per unit will effectively raise tariffs by Rs 1.83 per unit in April.
NEPRA Chairman Chaudhry Waseem Mukhtar urged the Power Division to conduct a study on the reasons behind negative demand growth to provide clarity to stakeholders. Additionally, he raised concerns over the Rs 1.98 billion burden on consumers due to violations of the Economic Merit Order (EMO), pressing the Power Division to investigate the issue and implement corrective measures.
With reports of an impending drought, the chairman emphasized the urgent need for a mitigation plan to protect consumers from severe energy shortages. He also reprimanded the National Transmission & Dispatch Company (NTDC) for failing to meet its commitment to complete the Lahore North Transmission Line by April 2025, with the deadline now pushed to June 30, 2025, alongside delays in the SCADA-III project until October 2025.
NPCC data revealed a 6.6% decline in electricity supply in February compared to projections, with a 3.3% year-on-year drop and an overall 3.2% decrease in energy generation for the fiscal year. Similarly, CPPA-G reported a 5% reduction in February electricity sales against reference targets.
Amid industry concerns over rising tariffs, industrial consumer Aamir Sheikh lamented the delay in the Quarterly Tariff Adjustment (QTA) decision, which could have prevented the tariff increase in February. He demanded that the QTA reduction of Rs 2 per unit be announced from March 1, 2025, to prevent further financial strain on industries, which have already seen multiple textile mills shut down in recent weeks, leaving over 25,000 workers unemployed.
Additionally, concerns were raised over increasing power allocations to K-Electric (KE), which has resulted in higher fuel costs for DISCOs while KE consumers benefit from significant FCA relief. Industrial representatives warned that the impending 65% water shortage forecast by the Indus River System Authority (IRSA) could severely impact hydel generation, leading to greater reliance on costly imported coal and RLNG, driving FCA adjustments even higher in the coming months.
Stakeholders urged NEPRA, CPPA, and NTDC to devise a concrete strategy to mitigate the anticipated crisis and prevent further economic disruption.
Story by Mushtaq Ghumman
