ISLAMABAD:
The Power Division has welcomed a decision of the National Electric Power Regulatory Authority (Nepra) on K-Electric’s (KE) Multi-Year Tariff review as a landmark for the people of Karachi.
In a statement, a Power Division spokesperson said that some circles are spreading propaganda to misrepresent Nepra’s review of MYT, portraying a regulatory correction as a fiscal manoeuvre or consumer burden. “In reality, the authority’s determinations are guided purely by the principles of equity, consistency and sectoral sustainability,” the official said.
According to the spokesperson, the review was conducted to align KE’s tariff framework with those applicable to other transmission and distribution (T&D) companies. “Nepra’s review eliminated tariff elements inconsistent with the national regulatory standards, including foreign currency-indexed returns, loss allowances, etc.”
The review removed these, ensuring that all utilities are regulated under the same principles of cost recovery, efficiency and transparency. The return on equity was converted from US dollar-based to rupee-based, T&D losses were rationalised and working capital was allowed as per requirement. “These measures rectify structural imbalances, not reduce legitimate recoveries,” the official argued.
The Power Division dismissed claim that Nepra’s decision deprives Karachi consumers of any “relief”. “K-Electric’s Multi-Year Tariff pertains to the company’s internal revenue requirements, not the consumer-end tariff. Consumer tariffs across all distribution companies, including K-Electric, are determined and notified by the government under the national uniform tariff policy,” it said.
The division also rejected the suggestion that the decision represents a reallocation of resources or the government has unplugged a subsidy of Rs7 per unit being given to the electricity consumers of Karachi. “The subsidy to K-Electric consumers is still in place under the uniform tariff. A reduction in subsidy is not a diversion of funds; it simply lessens fiscal expenditure.”
