President FPCCI Presents Mechanism of Fixed Charges

Irfan Iqbal Sheikh, President FPCCI, has expressed his profound concerns that National Electric Power Regulatory Authority (NEPRA) is not looking after the interests of the people, the business community, and the economy.

He added that the current practice of fixed charges based on 50% of sanctioned load defies all logic and fair practice; and, the past mechanism for fixed charges based on actual maximum demand (MDX) and the units consumed should immediately be reinstated for electricity billing.

The fixed charges based on 50% of the sanctioned load instead of actual Maximum Demand is totally out-of-sync with the actual consumption and ground realities of industries; a large number of which are dysfunctional or operating at their partial capacities due to floods and rains.

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Furthermore, the industry is forced to work in an environment of insufficient power supply against the demand in the system.

FPCCI Chief highlighted that the business environment of Pakistan is in stagnation due to the burgeoning cost of doing business; and, the NEPRA is not listening to the legitimate concerns of the business community.

NEPRA has also abruptly canceled a public hearing recently; further adding fuel to the frustration of the consumers suffering at the hands of DISCOS and K Electric, more due to non-profound decisions made by NEPRA against the consumer interests.

Engr. M. A. Jabbar, VP FPCCI, has emphasized that NEPRA should have a meaningful consultative process with the real stakeholders of the issue, i.e. business, industry, and trade community, and trade bodies as they are the ones who can provide the most practical and sustainable solution towards reducing the cost of electricity and related anomalies in electricity bills nationwide.

Engr. Jabbar further added that K-Electric should be made to decrease their dependence on obsolete and inefficient plants to offer some respite to their consumers on the back of a more efficient price matrix of K-Electric’s generation sources.

Mr. Irfan Iqbal Sheikh has explained that thousands of SMEs are closed due to the economic conditions and floods in the country; and, there is no way that these companies can pay their unfairly generated bills based on sanctioned load, increased monthly Fuel Price Adjustment, Quarterly Tariff Adjustment and severe hike in base tariffs.

President FPCCI has pointed out another area of concern is high average Transmission & Distribution (T&D) losses as controlling these losses can provide considerable room to the government to rationalize power tariffs across the country and improve the balance sheets of the loss-making DISCOS.