The National Electric Power Regulatory Authority (NEPRA) has imposed a total fine of Rs60 million on the Central Power Purchasing Agency (CPPA) and the National Transmission and Despatch Company (NTDC) over abnormal increases in fuel costs and system inefficiencies recorded in January 2024.
According to NEPRA, the fuel cost benchmark for the month was set at Rs7.49 per unit, but the actual cost surged to Rs14.60 per unit. The CPPA had requested a hike of Rs7.13 per unit under the fuel price adjustment mechanism, prompting the regulator to initiate an inquiry.
The investigation revealed that despite the availability of cheaper power generation sources, expensive electricity was produced using furnace oil and diesel. NEPRA noted that output from LNG and nuclear plants was reduced, while reliance on costlier fuels resulted in power generation worth Rs31.23 billion.
Following the findings, NEPRA imposed a Rs10 million fine on CPPA for failing to justify the increase, while NTDC was penalised Rs50 million for not improving the transmission system.
The regulator said NTDC’s failure to upgrade infrastructure prevented cheaper electricity generated from local coal from being transmitted to northern regions, contributing to higher overall costs.
NEPRA has directed both entities to deposit the fines within 15 days.
