There is going to be some relief to consumers in Pakistan regarding their electricity bill, November 2024. After going through rising electricity prices for months, the electricity consuming people are likely to see a refund of PKR 0.7057 per unit from overpayment in the month of September. This is a huge sigh of relief not only for householders but also for the business community as both of them have already been hit hard by a high cost of living and inflation.
For most, the rising energy price, as characterized by increasingly complicated bills to fight over, has been a growing concern. Perhaps the news that November’s bill may be dropped gives hope to consumers who have struggled to keep up with sky-rocketing energy costs.
Why Are Electricity Prices Expected to Drop?
The Ex-Wapda Distribution Companies (XWDISCOs) are making the proposed refund in the shape of a fuel price adjustment (FCA) for the billing month of November. Petitions were filed by the Central Power Purchasing Agency with the National Electric Power Regulatory Authority (NEPRA) over claims that consumers were overcharged by Rs 4.8 billion on their electricity bills in September. It is a case of overpayment simply because the actual cost of fuel used for electricity generation during September was lower than the reference cost that the use of bills made to calculate.
In the petition filed with CPPA, a reference fuel charge for September was computed at Rs. 9.8006 per unit, but ultimately remained only Rs. 9.0949 per unit, meaning this resulted in overcharging. Thus, the amount that is likely to be refunded is about Rs. 0.7057 per unit.
Public Hearing and Approval Process
NEPRA will hold a public hearing on the petition on 30th October, 2024. Following this, an assessment of justification of the adjustment proposed by the authority would be made whether it is a valid adjustment or not, whether the power dispatch is in compliance with EMO, and hence clear transparency in all refund orders issued to consumers as their refund orders are matching up with the actual generation cost of electricity.
However, it is important to note that not all consumers will benefit from this refund. According to the petition, the following categories of users will be excluded:
Lifeline consumers (those who use up to 50 units per month)
Households consuming up to 300 units per month
Electric vehicle charging stations
Pre-paid electricity users
Agricultural consumers
These groups, which are usually the most vulnerable, will not see the benefits of this refund in their November bills, which may leave some disappointed.
Ongoing Fuel Price Adjustments
This potential refund for November marks the third consecutive month of reductions under the FCA. Previously, consumers received a Rs. 0.369 per unit refund in their September bills following an FCA decision made in July.
The FCA mechanism is designed to adjust electricity prices based on the fluctuating cost of fuel used to generate power. From January 2023 to June 2024, the FCA remained positive, meaning consumers faced extra charges on their electricity bills. The highest increase during this period was recorded in January 2024, when consumers paid Rs. 7.05 per unit extra due to high fuel costs.
With fuel prices stabilizing in recent months, the adjustments have shifted in favor of consumers, leading to the proposed refund for November.
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Major Price Drop Expected for Petrol and Diesel This Week
A Welcome Relief for Consumers
Lower electricity bills in November means lower electricity costs for many, and it brings about a little bit of much-needed relief on the finances. With energy prices being a drag on household budgets, every little bit counts. This refund will not affect everyone, but at least it goes in the right direction for most consumers who have been burdened with increased costs for months.
Thus, until the final order of NEPRA has been received post-public hearing, consumers still hope that this trend of lowering prices of electricity will continue into the future and thereby lessen their burden of costs incurred monthly.
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