FPCCI Asks Nepra to Reject Rs268bn in Disputed Power Tariff Claims

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has asked Nepra to reject Rs268 billion in charges that ten former Wapda distribution companies want added to electricity bills for 2027, telling the regulator in a formal representation that much of the sum is retrospective, contested or has already been thrown out once before.

What the Discos are asking for

The objection responds to tariff petitions filed by the ten distribution companies (Discos) seeking adjustments under the 2025-30 multiyear tariff framework for calendar year 2027, on top of other consumer-end charges. Collectively, the ten companies are claiming Rs2.64 trillion in total revenue requirements for the year. FPCCI set up a dedicated Energy Advisory Committee to review the petitions on behalf of its member chambers and trade associations, examining each Disco's working capital, power-purchase prices, prior-year adjustments (PYAs) — the mechanism Discos use to recover costs they say were under-recovered in earlier years — and returns on their revenue base.

Where FPCCI says the numbers don't add up

The committee's review found that PYA claims make up a disproportionate share of several Discos' distribution margins: more than 212 percent at Islamabad Electric (Iesco), 113 percent at Sukkur Electric (Sepco), 91 percent at Faisalabad Electric (Fesco), 68 percent at Multan Electric (Mepco), 60 percent at Quetta Electric (Qesco), 41 percent at Lahore Electric (Lesco), 40 percent at Peshawar Electric (Pesco) and 32 percent at Gujranwala Electric (Gepco). Tribal Electric did not disclose comparable figures. FPCCI's position is that claims of this scale are not the "routine formula-based true-ups" the PYA mechanism was designed for.

Five claims under the heaviest scrutiny

The chamber's itemised objections single out specific charges at each company. Fesco's Rs535 billion requirement includes Rs57 billion in PYAs, of which FPCCI wants Rs26 billion rejected, covering 11-year-old post-retirement benefit claims and charges Nepra had already disallowed once. Gepco's Rs70.4 billion requirement includes Rs17 billion in PYAs tied to sovereign receivables from Azad Jammu and Kashmir dating back 19 years. Sepco's Rs68 billion requirement carries Rs36 billion in PYAs. Lesco's Rs759 billion requirement — the highest of the ten — includes roughly Rs33 billion in PYAs, of which FPCCI wants Rs27 billion rejected as unverified. Iesco's Rs525 billion requirement includes the largest single PYA claim, Rs158 billion, which FPCCI says was filed as an undifferentiated lump sum and is 70 percent disputed or non-cash. At Pesco, Rs33 billion of a Rs35 billion PYA claim traces back to seven-year-old input-tax claims the chamber calls inadmissible.

What FPCCI wants changed in the process

Beyond the individual rejections, FPCCI is asking Nepra to make its objections part of each Disco's formal tariff-setting process, including the public hearings the regulator holds before issuing a determination. It wants the Discos to answer specific line-item objections in writing ahead of those hearings, lump-sum PYA claims rejected in favour of claims substantiated component by component, and trade and business bodies given a formal role in the hearings rather than a general right to attend.

Why this matters for consumer bills

PYA disputes recur almost every tariff cycle because the mechanism exists to let Discos recover, with a lag, costs they say fell short of what their own tariffs covered at the time — the same logic behind the monthly fuel charges adjustments that have pushed bills up through this year's furnace oil substitution following the Gulf's LNG disruptions. Left unchallenged, PYAs compound in the same way unresolved costs feed into the sector's circular debt. A parallel dispute over how one Disco's own tariff order should be calculated is already before the courts, after the Sindh High Court suspended K-Electric's tariff order pending further hearings — a reminder that Nepra's determinations are rarely the final word once large sums are in play.

What happens next

Nepra has not yet said how much of FPCCI's Rs268 billion objection it will accept, and the regulator has a pattern of trimming, rather than fully rejecting, the claims it finds only partly justified. How it rules will decide how much of the Discos' combined Rs2.64 trillion requirement actually reaches consumer bills in 2027, and whether a chamber representing the industrial users who pay some of the highest tariff slabs has managed to make prior-year adjustments harder to wave through in the next cycle.

Build Better Pakistan's Energy Desk tracks Nepra tariff determinations and their effect on household and industrial electricity bills.