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NEPRA set to approve rise in power prices by Rs2.01 per unit

The National Electric Power Regulatory Authority (NEPRA) is set to approve an increase of Rs2.01 per unit rate of electricity for ex-WAPDA distribution companies under the fuel price adjustment mechanism.

NEPRA would hold a public hearing on May 29 to approve the raise against fuel price adjustment for the month of April 2012, officials said.Pursuant to section 31 (4) of the NEPRA Act and the mechanism for monthly fuel price adjustment prescribed by the authority in the tariff determinations of ex-WAPDA distribution companies, the authority has to review and revise the approved tariff on account of any variations in the fuel charges on monthly basis.

The proposed rise in prices will be reflected in the bills of consumers of electricity in all parts of the country except Karachi, which is supplied by the only privately-owned and only fully-integrated, utility company.

NEPRA makes decisions for the Karachi Electric Supply Company (KESC) separately, officials said.On the basis of information provided by the Central Power Purchasing Agency (CPPA), NEPRA has proposed an increase of Rs2.009 per unit over the reference fuel charges of Rs7.6842 per unit.

Pakistan’s gas fields are being depleting rapidly and not being replaced fast enough, resulting in more and more power plants relying on oil rather than gas. This in turn has led prices of electricity to keep on rising, he said.

The cheapest and most abundant form of electricity production in the country remains hydroelectric power, which accounts for around 22 percent of the total production. Yet, hydroelectric power remains a highly politicised issue in the country, with several political parties, including the ruling Pakistan Peoples Party opposing the construction of large dams.

The Kalabagh Dam, first proposed in the 1970s, has yet to be built because of this issue. The next cheapest source of electricity is coal, but only produces around 0.1 percent of the total electricity produced in the country.

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