How NEPRA Sets the Fuel Charge on Your Electricity Bill in Pakistan, From Request to Bill
How NEPRA turns CPPA-G's monthly fuel claim into the FCA on your electricity bill: the formula, five steps, who is exempt and what it approved in 2026.
Short answer: The fuel charge on your electricity bill is set by NEPRA each month. CPPA-G asks for the gap between actual and expected fuel cost, NEPRA holds a public hearing, trims the claim and notifies a rate. It lands on the bill two months after the fuel month. In 2026 NEPRA has allowed less than CPPA-G asked every month we checked.
The line is called the fuel charges adjustment, or FCA. On a 300 unit bill it can add several hundred rupees, and it changes every month. We read NEPRA's FCA decisions for March to August 2026 and the September hearing notice to set out exactly how the figure is reached, who pays it and how to follow it.
The fuel charge is actual fuel cost minus the reference in the tariff
Every tariff includes a reference fuel cost for each month. When the actual fuel cost of power delivered to the distribution companies is higher, the difference is added to bills. When it is lower, it is refunded. NEPRA does this under Section 31(7) of the NEPRA Act.
In August 2026, for example, CPPA-G said fuel cost Rs 8.8265 a unit against a reference of Rs 7.0998. It asked for the difference, Rs 1.7267. NEPRA worked out the actual cost at Rs 8.2084, so it approved Rs 1.1086. The reference changes month to month, as the table shows.
| Fuel month, 2026 | Reference, Rs a unit | Requested FCA | Approved FCA | Billed in |
|---|---|---|---|---|
| March | 7.9952 | +0.2660 | -0.0102 | May |
| May | 8.4315 | +0.8173 | +0.3364 | July |
| June | 7.7138 | +1.2000 | +0.7503 | August |
| July | 7.0929 | +2.5182 | +2.0581 | September |
| August | 7.0998 | +1.7267 | +1.1086 | October |
| September | 7.4596 | +2.5624 | Hearing 29 October | November, expected |
March is the clearest case of NEPRA's checks at work. CPPA-G asked for an increase of Rs 0.2660, and NEPRA's order turned it into a small refund of Rs 0.0102 a unit.
Five steps take a request from CPPA-G to your bill
The process runs on a fixed rhythm. CPPA-G files mid-month, NEPRA advertises and hears it, then decides and notifies the rate in the official Gazette. The August 2026 charge shows the dates in practice, from a 15 September filing to October bills.
- CPPA-G files its claim with fuel data. For August it wrote on 15 September 2026.
- NEPRA publishes a hearing notice with the generation table. August's appeared on 19 September.
- NEPRA holds a public hearing at NEPRA Tower and on Zoom. August's was on 29 September.
- NEPRA decides and the rate is notified. August's decision and SRO 1754(I)/2026 are dated 7 October.
- Companies bill it on the units used in the fuel month. August's charge is on October bills.
Anyone can object at step 3. The steps to do so are in how to take part in a NEPRA public hearing. The current request is set out in the September fuel charge request.
NEPRA trims plant costs, imports and past adjustments
NEPRA does not simply accept CPPA-G's figure. It replaces plant fuel costs with the rates it has approved, checks imports and past adjustments, and relies on CPPA-G's certified data for the rest. Any later error is corrected in a future month.
In August 2026, NEPRA cut Rs 17,279 million from plant fuel claims, mostly RLNG plants, in place of the Rs 10,617 million cut CPPA-G had offered. It also told CPPA-G to reconcile the cost of power imported from Iran, 58.894 GWh at Rs 26.91 a unit. The plant by plant detail is in how NEPRA cut Rs 17.3 billion from plant claims.
Previous adjustments can swing a request a lot. In September's request, Rs 1.2390 of the Rs 2.5624 is a carried-forward previous adjustment, not September fuel.
Lifeline, prepaid and EV charging users do not pay it
NEPRA's orders apply the fuel charge to every consumer category of K-Electric and the distribution companies, with three exceptions: lifeline consumers, electric vehicle charging stations and prepaid consumers. K-Electric customers pay the same uniform rate under federal policy.
| Consumer | Pays the fuel charge? |
|---|---|
| Homes, shops, industry, farms of ex-WAPDA companies | Yes |
| K-Electric customers in Karachi | Yes, same rate |
| Lifeline consumers | No |
| Prepaid meter consumers on a prepaid tariff | No |
| Electric vehicle charging stations | No |
| Incremental consumption package units | Positive charge yes; the March refund no |
Protected domestic consumers are not on NEPRA's exemption list, so they pay it too. Each order also says a bill issued before the notification can carry the charge in the following month instead.
The quarterly adjustment is a separate line
The fuel charge is not the only adjustment on the bill. A quarterly adjustment covers other power purchase costs, such as capacity payments, and is billed over three months. NEPRA set Rs 0.5194 a unit for April to June 2026, billed from September to November.
So a November bill can carry both the September fuel charge and the last month of that quarterly charge. To work out the money on your own bill, use the method in the October fuel charge calculator: units billed for the fuel month times the rate, plus any taxes your bill applies to it.
Common questions about the fuel charge adjustment
Who decides the fuel charge on my bill?
NEPRA, the power regulator. CPPA-G requests it, but NEPRA decides after a public hearing and the rate is notified in the Gazette.
Why is the fuel charge two months late?
Actual fuel costs are known only after the month ends. Filing, hearing and decision take about five weeks, so it reaches the second bill after.
Can the fuel charge be negative?
Yes. NEPRA turned March 2026's requested increase into a refund of Rs 0.0102 a unit, billed in May 2026.
Do K-Electric customers pay the same fuel charge?
Yes. Under federal policy guidelines for a uniform charge, NEPRA applies the same rate to K-Electric consumers.
Does NEPRA always approve less than requested?
In every month we checked from March to August 2026 it did. It allowed 41 to 82 per cent from May to August, and turned March into a refund.
What is the reference fuel cost for September 2026?
Rs 7.4596 a unit, according to NEPRA's September hearing notice. CPPA-G says the actual cost was Rs 10.0220.
How we verified this
What we checked, where we read it, and what we could not confirm.
Last checked 20 October 2026. The references, requests, approvals, billing months, exemptions and the Rs 17,279 million cut come from NEPRA's FCA decisions for March, May, June, July and August 2026 and its quarterly adjustment decision of 4 September 2026, all listed on NEPRA's distribution tariff page. The September figures come from NEPRA's hearing notice posted on nepra.org.pk on 19 October 2026. The approval shares are our arithmetic. We did not read the April 2026 decision closely because its printed figures look transposed, so it is left out of the table. We did not check how each company taxes the fuel charge line.
About the author
Global Affairs & Political Economy Writer
Muhammad Hatim is a book lover who started writing because he enjoys it. At Pakistan Era he writes about international relations, geopolitics and the global economy, with a particular interest in South Asia and the forces behind current events.
