Pakistan Power Bills Set to Rise Amid Fuel Cost Adjustments

Islamabad – Pakistani electricity consumers are bracing for potential increases in their power bills following requests for fuel cost adjustments (FCA) filed by both the Central Power Purchasing Agency-Guarantee (CPPA-G) and power companies. These adjustments, driven by fluctuations in fuel costs, come despite a significant portion of power generation originating from relatively cheaper domestic sources.

Recent FCA Requests and Approvals

The CPPA-G recently requested the National Electric Power Regulatory Authority (Nepra) to approve an additional collection of Rs0.1911 per unit from consumers for August 2025, potentially adding Rs3 billion to the national electricity bill. Geo.tv reports that a public hearing was scheduled for September 29th to decide on this matter. This request stems from a difference between the reference fuel charges of Rs7.3149 per unit and the actual cost of power generation, which averaged Rs7.5059 per unit.

More recently, power companies have sought a further Rs1.64 per unit increase for April bills, based on power consumption in February. Dawn indicates that this would translate to an additional Rs12.2 billion charged to consumers across the country, including both ex-Wapda Distribution Companies (Discos) and K-Electric. A public hearing to examine these charges was scheduled for March 31st.

February Fuel Cost Breakdown

Despite over 75% of power generation in February coming from domestic and cheaper sources, the CPPA demanded a higher fuel cost. The average fuel cost for February was Rs8.37 per unit, compared to Rs8.23 per unit in the same month last year. Total power delivered to Discos in February reached 7,427 GWh, generated at an estimated fuel expenditure of Rs62.75 billion (Rs8.15 per unit).

The fuel mix for February included:

• Hydropower: Over 23% (regaining prominence after annual canal closures)
• Nuclear Power: 18.83%
• Local Coal: 16%
• Imported Coal: Nearly 15%
• Local Gas: 11.52%
• Regasified Liquefied Natural Gas (RLNG): 9.47% (a significant drop from 22% in January)
• Renewable Energy (Wind, Bagasse, Solar): 5.63%

RLNG-based generation remained the most expensive fuel source at Rs23.21 per unit, while nuclear fuel cost Rs2.50 per unit.

FCA Applicability and Tariff Mechanism

Under federal government guidelines, the fuel charge adjustment for Discos is also applicable to K-Electric consumers, ensuring uniformity across distribution companies. The FCA is reviewed monthly and typically applies to consumer bills for a single month. Changes in fuel costs are automatically passed on to consumers, while quarterly adjustments related to power purchase price, capacity charges and other factors are incorporated into the base tariff by the federal government.

Key Takeaways

• Pakistani consumers face potential increases in power bills due to fuel cost adjustments.
• Recent requests include Rs0.1911/unit for August 2025 and Rs1.64/unit for February consumption (applied to April bills).
• Despite a reliance on cheaper domestic fuel sources, fluctuations in fuel costs drive these adjustments.
• The FCA mechanism automatically passes fuel cost variations onto consumers.