Unusual RLNG price drives up electricity cost
ISLAMABAD: The cost of regasified liquefied natural gas (RLNG)-based power generation surged by record 242 per cent to Rs47.4 per unit in July, from less than Rs14 in April, after the government purchased five expensive cargoes from the spot market in the month due to the suspension of supplies from Qatar following the US-Iran war. Chiefly because of LNG factor, the power companies have sought a…
The cost of regasified liquefied natural gas (RLNG) power generation surged by an unprecedented 242% in July, reaching Rs47.4 per unit, compared to less than Rs14 in April. This dramatic price increase occurred due to the government's purchase of five expensive RLNG cargoes from the spot market following the suspension of supplies from Qatar following the US-Iran war.
As a result, power companies have requested a significant Rs2.52 per unit increase in fuel cost adjustment (FCA) for consumers' September bills, even though 73% of generation came from cheaper domestic sources. RLNG accounted for approximately 11% of the total grid supply. The National Electric Power Regulatory Authority (Nepra) scheduled a public hearing on August 27 to assess the justification for the Rs36.5bn additional demand from power companies, with a notable Rs2.52 per unit impact.
However, the situation is expected to worsen, as RLNG prices jumped by nearly one-third again in August. This will lead to an additional financial burden on consumers in the October billing cycle.
Written by urgent.news from Dawn Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
