Rs60 Million NEPRA Fine Highlights Pakistan’s Rising Power Costs, exposing serious inefficiencies in the power sector. The National Electric Power Regulatory Authority (NEPRA) imposed fines on the Central Power Purchasing Agency (CPPA) and the National Transmission and Despatch Company (NTDC). These fines address costly electricity production issues and rising electricity tariffs that burden households and industries.
In January 2024, the fuel cost benchmark was set at Rs7.49 per unit, but the actual fuel cost surged to Rs14.60 per unit. The CPPA requested an electricity tariff adjustment of Rs7.13 per unit, but NEPRA’s investigation revealed a reliance on furnace oil and diesel power generation despite available LNG and nuclear energy. This caused Rs31.23 billion in costly electricity production.
The NTDC also faced penalties for transmission inefficiency, which blocked local coal electricity from reaching northern regions. Expensive power generation’s combined with transmission system failures in Pakistan, worsened the electricity pricing issues. Experts noted that diesel-based power generation and reduced nuclear output contributed to the overall rise in electricity costs.
The NEPRA penalty on CPPA and NTDC sends a strong message to the energy sector. Authorities emphasized the need for fuel price adjustment in Pakistan and power sector reforms in Pakistan. Timely compliance is required, with fines to be deposited within 15 days. Analysts say Pakistan can avoid future crises by cutting high fuel costs and improving its power mix.
