The National Electric Power Regulatory Authority (Nepra) announced a reduction in K-Electric’s multi-year base tariff from Rs39.97 to Rs32 per unit, marking a 20% decrease for the fiscal years 2023-24 through 2030.
The NEPRA’s decision came after a review petition by the government; however, NEPRA rejected K-Electric’s request to reverse an Rs50 billion write-off, as it had already been approved. “The petitioners failed to justify changes,” Nepra stated, dismissing the motions.
This reverses Nepra’s May 27, 2025, decision raising tariffs 18.18% (Rs6.15/unit). K-Electric’s recovery rate fell to 91.5% in FY24 and may drop to 90.5% in FY25, projecting Rs97 billion under-recoveries over two years. Nepra warned the Rs21.6 billion distribution return could vanish without support.
Read: Sindh High Court Orders NEPRA to Survey K-Electric’s Infrastructure
Nepra set targets for the seven-year period:
- Transmission Losses: 0.75% annually (down from 0.86%), ceiling 1%.
- Distribution Losses: 9% total (8% technical, 1% law/order), declining to 8.03% by FY29-30.
The 75:25 sharing mechanism continues 75% efficiency gains, benefiting consumers, 25% for K-Electric. Nepra reaffirmed using the National CPI for fuel indexation, improving transparency. The cut eases consumer bills but strains K-Electric financially. Efficiency targets promote better operations.
