NEPRA concludes hearing on K-Electric’s FCA relief request

ISLAMABAD: The National Electric Power Regulatory Authority (NEPRA) has concluded its hearing on K-Electric’s appeal for conditional monthly Fuel Charge Adjustments (FCA) for March 2025.

K-Electric requested a PKR 5.02 per unit relief, quoting the fluctuations in global fuel rates and variations in the energy mix.

NEPRA is likely to circulate its conclusion, specifying the FCA amount on the customer bills and the tenor of it, which will be applicable.

NEPRA hearing on K-Electric FCA is a vital move in defining electricity tariffs for consumers of Karachi.

Fuel Charge Adjustments (FCA) are a general way used as a standard mechanism for utility companies to manage changes in fuel prices.

Once NEPRA evaluate and approves these adjustments, they are included in customer bills.

If global fuel prices decline, customers can also have an advantage from lower K-Electric FCA rates. NEPRA sets the prices on bills that customers eventually pay, which are announced by the Federal Government.

K-Electric has also expressed adjustments related to degradation curves, part load, and startup costs, determining the Generation Tariff for its power plants post-June 2023.

NEPRA has been requested to consider recovering these costs from negative fuel cost differences to avoid future financial loads on consumers.

As per the decision of the company, the negative FCA will apply to all consumer categories except lifeline consumers, domestic protected consumers, Electric Vehicle Charging Stations (EVCS), and prepaid electricity consumers who have opted for prepaid tariffs.

About K-Electric

K-Electric (KE) is Pakistan’s consolidated power utility, providing electricity to Karachi and its connecting areas.

K-Electric was initially established in 1913 as KESC, and it was privatised in 2005. KE is mainly owned (66.4%) by KES Power, a consortium of investors including Al-Jomaih Power Limited (Saudi Arabia), National Industries Group (Holding) (Kuwait), and the Infrastructure and Growth Capital Fund (IGCF).

The Government of Pakistan has a 24.36% stake, while the remaining shares are publicly traded.