Daily Times

The government on Thursday increased the electricity price by Rs2.75 per unit.

According to the notification issued by National Electricity Regulatory Authority (NEPRA), the electricity prices have been increased on account of quarterly adjustment.

The increase will be applicable on the months of April, May and June bills.

The price will be applicable on all the consumers of Discos and K-Electricity except lifeline customers.

The DISCOs have requested the NEPRA for quarterly adjustment while monthly fuel cost allowances adjustment of Rs5 per unit is yet to be made. Separately, the International Monetary Fund (IMF) has proposed measures to lower the power tariff for various consumer categories, suggesting an enhancement of the energy mix and a reduction in capacity charges by fully utilizing new power plants.

Sources within the Ministry of Finance revealed that the IMF has advised the government to operate new power plants at their maximum capacity to address the country’s energy requirements effectively.

Consumers currently bear an annual burden of around Rs2 trillion due to capacity charges resulting from the underutilization of new power plants.

The IMF underscores the necessity of decreasing capacity charges to lower industrial tariffs. Utilizing power plants at full capacity by incorporating alternative fuels could potentially slash capacity charges in electricity prices by Rs13 to Rs16 per unit.

The IMF specifically recommends the operation of 5,000-megawatt gas power plants fueled by indigenous gas, which could generate electricity at a significantly cheaper rate of Rs10 to Rs14 per unit compared to LNG. Ensuring uninterrupted power supply to all industrial zones is a critical aspect of the IMF’s proposal.

The term “energy mix” denotes the blend of various energy sources utilized by a country or region to generate electricity. This mix typically includes renewable sources like solar, wind, hydroelectric, and biomass, alongside non-renewable sources such as coal, natural gas, and nuclear power.

Managing the energy mix aims to strike a balance between energy security, affordability, and environmental sustainability.

Capacity charges, also known as capacity payments or tariffs, refer to fees paid to power generators or suppliers for their capability to deliver a certain amount of electricity to the grid, regardless of actual usage.