- Nepra criticizes KE’s dependence on NTDC for supplies.
- Calls launched to revoke KE generation license.
- The company is seeking an FCA refund of Rs 4.96 per unit.
ISLAMABAD: Karachi residents and industrialists expressed their frustration with K-Electric (KE) at a public hearing on Wednesday, accusing the utility of failing to provide consistent electricity to industrial and commercial areas, News reported.
They argued that frequent power outages hamper the federal government’s winter relief program, making it difficult for companies to increase production and business operations.
The National Electric Power Regulatory Authority (Nepra) also reprimanded KE for its over-reliance on the National Transmission and Dispatch Company (NTDC) for electricity supply, raising questions over the need for the public service to retain its production license.
Nepra Khyber Pakhtunkhwa member Maqsood Anwar suggested revoking KE’s production license. “If the company sources 67% of its supplies from NTDC, does it still need a production license? » asked Anwar.
He expressed concerns over the company’s power plants, noting that the cost of power generation at KE’s plants was high, with capacity payments reaching Rs 6-7 per unit.
The KE representative responded that KE will still need a generation license because the company has agreements with power producers and its termination will result in a penalty.
Furthermore, the national grid supply can reach a maximum of 2,000 MW, while the KE demand climbs to 3,400 MW during the summer. The representative further said that the company has the most efficient RLNG based power plants which cannot be abandoned.
The NTDC interconnections currently cap supply at 1,600 MW and KE expects NTDC to complete critical circuits by March or April, potentially increasing offtake capacity to 2,000 MW.
The KE official claimed that the capacity cost of KE plants was Rs 6-7 per unit as compared to NTDC’s Rs 26-27 per unit.
The hearing revolved around KE’s petition seeking a refund of Rs 4.96 per unit under the November Fuel Charge Adjustment (FCA) which, if approved, will result in relief of Rs 7.179 billion for consumers in their February 2025 bills.
Tanveer Bari of Karachi Chamber of Commerce expressed frustration over high electricity prices in KE, pointing out that businesses in Karachi are hit hard by high electricity costs and frequent load shedding, especially in industrial zones. “This is unfair and we demand that Nepra take action,” he said.
In Karachi, the Agro Export Processing Zone has installed its own power system but continues to face load shedding lasting several hours. “How can we benefit from the additional package under these conditions? » he questioned.
A Jamaat-e-Islami representative echoed the sentiment, saying KE’s inefficiencies and rising subsidies – now reaching 170 billion rupees a year – are causing more harm than good. “If Nepra revokes KE’s production license, it would be a favor to the residents of Karachi,” the representative argued.
The authority responded to complaints of load shedding, particularly in industrial zones, by launching an investigation. “We will visit the affected areas to assess the situation,” said Rafiq Sheikh, a member of the authority, urging KE to resolve these issues quickly.
Nepra also ordered KE to submit a report on load shedding, which will be made public on its website for the sake of transparency.
Furthermore, Sheikh further suggested that Electricity Distribution Companies (DISCOs) indulging in commercial load shedding should be subject to daily sanctions, stressing that such practices must stop. “From now on, we will monitor them daily,” he said.