KARACHI: K-Electric has approached the National Electric Power Regulatory Authority (Nepra) to increase the power tariff by Rs11.33/unit on account of fuel charges adjustment (FCA) for May.

Per applicable tariff across the country, fuel adjustment is reviewed every month and is applicable on consumer bills for only one particular month.

The major impact on the monthly FCA of May 2022 is due to an increase in the fuel price, furnace oil and power purchased from the Central Power Purchasing Agency (CPPA-G).

The price of furnace oil in May 2022 increased 38 per cent from March 2022 while the price of regasified liquefied natural gas (RLNG) between March to May 2022 has witnessed an increase of 50 per cent.

The price of electricity from CPPA-G in May 2022 has increased 53 per cent where the price of CPPA-G as of May 2022 is Rs13.897/KWh, compared to the price of Rs9.387/ KWh in March 2022.

Fuel Charge Adjustment (FCA) is incurred by utilities due to global variation in fuel prices used to generate electricity and change in the generation mix. These costs are passed through to the consumers following Nepra’s scrutiny and approval and are one-time charges. The consumers also receive a benefit when the cost of fuel decreases.

As per Nepra guidelines, the submissions discussed in the public hearing on July 4, the regulator will approve the request, after scrutiny, and issue instructions on the period during which these costs can be applied to consumer bills.