KARACHI: In case of unfavorable decision over its multi-year tariff (MYT) review motion by National Electric Power Regulatory Authority (Nepra), the K-Electric (KE) will likely to take the matter to court, claimed industry sources.Recently, Nepra held an open two-day hearing on the KE’s MYT review petition in local hotel here where it invited both interveners and KE’s management for comments.Interveners presented their case where they asked that no relaxation or upward revision to be offered to the KE.Sources said that Nepra’s Board seemed unwilling to heed KE’s most demands and it is likely that Nepra will keep its previous decision intact. Earlier this year, Nepra issued a base tariff of Rs12.07 per kilowatt-hour (kWh) while KE had asked for a tariff of Rs16.23 against the existing Rs15.57. However KE had filed review motion against the said decision. “We do not expect material change in KE’s MYT post this review hearing, it is highly expected that KE will opt a route of legal battle in-line with cases filed by other major Discos against Nepra’s tariff determination which will further increase the ambiguity and may also put Shanghai Electric Limited (SEL) deal in snags”, said sources.KE put forth demand for tariff that offers reasonable returns, however Nepra’s Board looked adamant on maintaining the existing tariff, likely due to its presumption of KE’s failure in achieving targets, added sources.The KE management projected the reduced base tariff of 2017 MYT to lower KE’s cumulative earnings by Rs 300 billion over the next seven years. They said that the company will turn into a loss making entity and it will be forced to terminate its investment program resulting in continued increase in demand-supply gap.However, Nepra’s Board dissatisfied with KEL’s achievements and seemed unwilling to heed to its demands. Nepra also seems unwilling to negotiate on KE’s demand that return calculation for clawback should exclude provision for doubtful debt and the regulatory asset base be calculated by capital employed versus fixed assets in new MYT, said sources.It is to be noted that KE has already challenged almost all decisions of regulators and other authorities that came against it in the Sindh High Court (SHC). KE challenged decision of Council of Common Interests (CCI) whereby it was decided to work out modalities for reduction of power from National Transmission & Despatch Company (NTDC) to KE from 650 to 350 MW. Published in Daily Times, July 18th , 2017.