Power Division Raises Concerns Over NEPRA’s Multi-Year Tariff Decision for K-Electric

ISLAMABAD: The Power Division has expressed serious reservations regarding the decision issued by the National Electric Power Regulatory Authority (NEPRA) on K-Electric’s 7-year Multi-Year Tariff (MYT). Federal Minister for Power, Awais Leghari, warned that such decisions could adversely affect future investments during the upcoming MYT period.
Minister Leghari stated that the decision will have long-term implications on federal subsidies and the uniform tariff structure. He emphasized that the Power Division will closely review the MYT decision issued for K-Electric and pointed out that a revision of older generation tariffs still awaits NEPRA’s attention. The delay in this revision, he added, is already having significant financial consequences on the power sector.
The minister cautioned that failure to address such regulatory issues could undermine the integrity of the regulatory framework. He further noted that these types of decisions could discourage private sector participation in electricity distribution, which the government has been trying to promote.
Recently, NEPRA approved K-Electric’s transmission and distribution tariff for the fiscal years 2023–24 through 2029–30. NEPRA granted a 12% return on equity for transmission and 14% for distribution, whereas K-Electric had requested 15% and 16.67% respectively.
The Power Division’s reaction underscores the federal government’s concerns about the potential impact of regulatory decisions on investor confidence and long-term planning in Pakistan’s energy sector.