Pakistan's NEPRA greenlights K-Electric's generation tariff petition

Pakistan's National Electric Power Regulatory Authority (NEPRA) has approved K-Electric's generation tariff petition for the period commencing post-June 2023.

The approved tariff framework incorporates reductions in operation & maintenance (O&M) costs and return on equity (RoE), reflecting NEPRA's efforts to promote efficiency and cost-effectiveness.

Additionally, the decision introduces a revised control period, aligning with KE's investment plan and facilitating a more predictable regulatory environment.

Notably, this determination does not affect electricity rates charged to consumers, which remain governed by Pakistan's uniform tariff policy.

Commenting on the decision in a note brokerage house AKD Securities said, “NEPRA's approval of K-Electric's generation tariff is a welcome development, but the real litmus test lies in the upcoming transmission and distribution tariffs, which will dictate the company's profitability.”

The approval of KE's generation tariff petition is a significant step towards achieving the goals outlined in Vision 2030. KE is actively engaging with NEPRA to finalize distribution, transmission, and supply tariffs, ensuring a comprehensive tariff framework. The company is also working closely with the regulatory authority to review its investment plan and align it with regulatory requirements.