KARACHI: The proposed upward revision in electricity tariff for next 10 years sought by K-Electric (KE) has received strong opposition from the stakeholders at a public hearing called by the National Electric Power Regulatory Authority (Nepra).
At the concluding session of Nepra’s hearing at a local hotel here on Wednesday, consumers representing the chambers of commerce, NGOs, employee unions, general public, politicians unanimously stated that the KE’s demand to seek determination of new Multi Year Tariff (MYT) for next ten years was unreasonable.
A number of issues were raised during the hearing like KE could not boost power generation while the tariffs of power utility remained on higher side. The interveners took up many critical issues being faced by the KE’s consumers like meter rent, non-payment of interest on security deposit to consumers, and bank charges collected by KE.
Arif Bilwani, one of the interveners, said KE has sanctioned 825 MW load during the last five years in terms of new connections, which is more than its generation capacity, without improving the power generation.
Bilwani requested to the Nepra that instead of existing tariff the 2002 tariff should be implemented for next ten years in true letter and spirit. “When KE has failed to fulfill its commitments in the past ten years, how will it then be able to implement its business plan proposed for next ten years,” he questioned.
Bilwani said the KE is continuously showing increase in expenses which is totally unjustified as before privatization, in 2005, the power utility’s expenses stood at Rs 14747 million with 18500 workforce whereas in 2015 the KE showed Rs 37396 million of expenses having 10500 employees.
“In the last ten years KEs’ expenses have been increased enormously by almost 175 percent that doesn’t justify the increase in inflation rate,” he added. Another intervener Aurangzeb Elahi said that despite many rulings issued by Nepra KE is collecting bank charges illegally.
“KE has devised new ways of minting money from the consumers as the company sends supplementary bills demanding arrears, however the company doesn’t mention the details of connected load. Prior to privatization, interest on consumers’ security deposit was added to consumers’ account every April, however, KE has stopped this practice which is a sheer violation of the Nepra’ law,” said Aurangzeb.
On the other hand, some stakeholders supported the KE’s MYT petition as former president of Korangi Association of Trade & Industry (KAATI) Rashid Ahmed Siddiqui said KE has resolved many issues of industrial areas and is catering the industrial zones adequately which will lead to increase in exports and business activities.
Similarly, a representative from Habib Bank Limited said “We need clarity on cash flow as HBL is the largest lender of KE. We support long term tariff as financing such big projects need guarantees”.
Chairman Nepra Tariq Saddozai in his concluding remarks stated that the authority has noted the stakeholders’ concerns and the decision would be made soon. He also requested the participants that further comments regarding KE’s MYT petition can be sent to the Nepra within next ten days.
Nepra has identified 39 issues, which were discussed during the two days of the public hearing, while the regulatory authority had invited interveners as well as some 39 stakeholders to attend the hearing.
Meanwhile, KE said it has planned to add 4,283 megawatts to its generation capacity and improve the average fleet efficiency to 43.3 percent from 37 percent over the next 10 years.
‘The company will enhance its transmission network by 28 percent and increase the capacity of power transformers by 3,370 megavolt amperes (MVA) till the fiscal year of 2025/26, it said during a public hearing on its integrated MYT.
According to its 10-year business plan, the utility’s transmission and distribution losses will be cut to 13.8 percent in FY26 from 23.7 percent in FY15. The distribution network will be added with over 1,000 new feeders, and more than 4,500 kilometers of 11-kilovolt underground and overhead circuits.