The National Electric Power Regulatory Authority (Nepra) is expected to lower the power tariff by Rs1.035 per unit as part of the monthly fuel price adjustment for December 2024, bringing some much-needed relief to electricity consumers facing high energy costs. This reduction is based on a formal request submitted by the Central Power Purchasing Agency-Guarantee (CPPA-G) on behalf of power distribution companies (DISCOs).
The proposed tariff cut compares to a reference fuel cost of Rs10.6364 per kilowatt-hour (kWh), with the CPPA-G estimating the average fuel cost at Rs9.6011 per unit in December 2024. Nepra has scheduled a public hearing for January 30 to review the proposal and its impact on the energy sector. If approved, the tariff reduction will be reflected in February bills for most consumers, excluding lifeline users, electric vehicle charging stations, and K-Electric customers.
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In December 2024, DISCOs received a total of 7,516 gigawatt-hours (GWh) of electricity at a total cost of Rs72.164 billion, with the CPPA-G also including a recovery demand of Rs2.453 billion from previous adjustments. Hydroelectric power, which accounted for 22.8% of the total energy mix, was delivered at no cost. Meanwhile, other energy sources like local and imported coal, natural gas, re-gasified liquefied natural gas (RLNG), and nuclear power contributed significantly but varied in cost.
Nuclear power plants, which provided 26.48% of the energy, had the lowest production cost at Rs1.698 per unit, while electricity imports from Iran came at a much higher rate of Rs28.0589 per unit. Renewable energy sources, including wind, solar, and bagasse-based plants, also played a role in the energy mix.
The tariff reduction, if approved, will offer some financial relief to electricity consumers in February, as the energy sector continues to grapple with fluctuating fuel costs. Nepra’s public hearing will provide a platform for stakeholders to raise any objections or concerns about the proposed revision.
