ISLAMABAD, DEC 20 (DNA) – The National Electric Power Regulatory Authority (Nepra) notified on Wednesday to increase the average power tariff by Rs1.27 per unit for one year.

The regulator set aside concerns of stakeholders who opposed the increase, citing that the government was charging more than 50% taxes out of actual electricity price from the consumers.

According to Nepra’s decision, the distribution companies would recover Rs226 billion from electricity consumers. The tariff was being notified following the proposed increase by the federal government.

Nepra also imposed certain conditions with the hike in tariff. It asked the government to fulfil public consumer interest, ownership and control of the applicant through common shareholding and consolidated accounts of the applicant.

For one year: NEPRA notifies tariff hike by Rs1.27 per unit

The Pakistan Tehreek-e-Insaf (PTI) government approved the increase in electricity prices by around 33% in October this year but did not increase the rates for consumers utilising up to 300 units per month.

The Economic Coordination Committee (ECC) of the Cabinet approved to expand the average electricity prices by at least Rs1.27 while Nepra proposed to increase the average electricity prices by Rs3.82 per unit.

Following the decision of the power regulator, the resolution of the federal government to increase the power tariff would be implemented.

The stakeholders opposed the decision saying that the regulator could not conduct a public hearing due to a lack of quorum. They further added that any retrospective adjustment in electricity prices should be borne by the government instead of the consumer.

“Any increase or compensation/adjustment should not be transferred to industrial consumers,” they demanded.

They were of the view that while determining the tariff, poor performance of distribution companies and burden of losses and theft of general consumers should not be placed on the shoulders of the industry.

“Taxation contributes to more than 50% of the actual electricity price including sales tax, income tax, EQ surcharge and other surcharges.

Regarding the lack of quorum to conduct hearing, the Nepra stated that as per Rule 9(5) of the tariff rules, a hearing may be conducted by a single member of the authority, who shall be designated as the presiding officer by the authority for that purpose, provided that the final decision or determination in the proceedings shall be taken by the authority on the basis of the recorded proceedings.

As per the said rule, hearings pertaining to tariff determinations can be conducted by a single member.

The question of fiscal federalism is addressed by the subsequent condition to the process, namely that despite the conduct of hearing by two members, the final determination will be the result of the decision of the duly constituted authority, fulfilling the statutory quorum requirement ie (three members or the chairman/vice chairman plus two members).