PM’s Rs4.04 industrial relief part of base tariff, FCA remains variable: Power Division

ISLAMABAD: The Power Division on Friday clarified that the Prime Minister’s electricity relief package of Rs4.04 per unit for the industrial sector is part of base tariff, while Fuel Cost Adjustment (FCA) QTAs are monthly variable, reported Associated Press of Pakistan (APP).

In a statement, the spokesperson for the Power Division said that certain media reports had created unnecessary confusion by linking the positive FCA with the relief package announced by Prime Minister Shehbaz Sharif.

The two are separate elements within the tariff determination framework and have no direct relationship.

He emphasized that FCA and Quarterly Tariff Adjustments (QTAs) are routine regulatory mechanisms applied strictly on the basis of actual variations in generation cost and system performance during a given period.

“These adjustments may be positive or negative depending upon prevailing fuel prices and electricity generation patterns and are implemented transparently under the approved tariff regime,” the statement said.

The Spokesperson added that accordingly, any increase or decrease on account of FCA reflects only month-to-month changes in actual fuel costs and does not constitute withdrawal or reduction of any policy relief.

Similarly, QTAs are periodically applied to reconcile verified cost variations and may offset or moderate the impact of FCA adjustments, he added.

The Spokesperson categorically said that the Prime Minister’s relief of Rs4.04 per unit forms part of the base tariff and remains fully effective and unchanged. The application of FCA or QTA is independent of this relief and operates as a standard feature of the electricity tariff mechanism applicable to all consumers.

The Spokesperson concluded that, associating the recent FCA with erosion or reversal of the Prime Minister’s relief package is a mischaracterisation of tariff mechanics. The announced relief continues to remain in place, while FCA and QTAs are being applied strictly in accordance with actual costs under the established regulatory framework.