No change in petroleum prices in October

no-change-in-petroleum-prices-in-october

No change in petroleum prices in October ISLAMABAD: Prices of all petroleum products will remain unchanged in October while electricity rates for the consumers of all power companies, except K-Electric, will be slashed by Rs2.56 per unit mainly because of lower international oil prices.

After meeting Prime Minister Nawaz Sharif, Finance Minister Ishaq Dar announced that the prices of five key petroleum products will be kept unchanged in October.

He said the Oil and Gas Regulatory Authority (Ogra) had recommended a minor cut in the price of high-speed diesel along with an increase in the prices of all other products.

The National Electric Power Regulatory Authority (Nepra) ordered the distribution companies of ex-Wapda to refund Rs2.56 per unit to consumers in order to pass on the impact of lower-than-anticipated generation cost in August.

At a public hearing presided over by Nepra Chairman Tariq Sadozai, the regulator concluded that the distribution companies had overcharged consumers with the approval of the regulator by almost 40 per cent in August, which should be returned in the billing month of October.

The decision will result in a refund through the bill adjustment of Rs26 billion. Out of this amount, Rs22bn is on the back of lower international prices while Rs4bn comes out of a better energy mix.

The regulator held that the actual fuel cost of power generation in August was around Rs3.89 per unit against the pre-determined reference tariff of Rs6.46 per unit. As such, the distribution companies had overcharged consumers by Rs26bn, which should be refunded to consumers at the rate of Rs2.56 per unit.

The reduced rates will not be applicable to agricultural and domestic consumers using less than 300 units per month. Likewise, consumers of K-Electric will not benefit from this relief.

The Central Power Purchasing Agency (CPPA) reported that the furnace oil-based power generation cost stood at Rs7.79 per unit compared to the gas-based average cost of Rs5.4 per unit.

The fuel cost of diesel-based plants was reported at Rs12.60 per unit. No fuel cost was reported for hydropower plants and Rs1.16 per unit was reported for nuclear plants. The fuel cost of electricity imported from Iran stood at Rs10.6 per unit.

The CPPA reported that 10.78bn units of electricity were supplied to the distribution companies in August at a total cost of Rs41bn having an average actual fuel cost of Rs3.95 per unit.

It said the hydropower generation contributed the biggest share of about 39pc while furnace oil-based plants generated about 28pc energy. Gas-based plants generated 24pc electricity for the national grid followed by nuclear plants (4pc) and diesel plants (1.3pc).

Source: http://www.dawn.com/news/1287171/no-change-in-petroleum-prices-in-october

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