SC: No power tariff hike above 5%

KATHMANDU, Jan 11: The Supreme Court has issued a pre-emptive interim order Tuesday prohibiting the Electricity Tariff Fixation Commission (ETFC) from raising tariff by more than five percent.



Saying that the preparation by ETFC to raise tariff by 20 percent is illegal as it is against the Electricity Tariff Fixation Rules 1994 that allows hike of just five percent in a year, the single bench of Justice Sushila Karki ordered not to immediately make any decision against the general welfare of the common people. It has also asked the defendant ETFC to furnish written reply to the apex court within 15 days.[break]



The Consumer Rights Protection Forum (CRPF) had filed a quo warranto on the basis of Electricity Tariff Fixation Rules 1994 amidst reports that ETFC was going to raise tariff by around 20 percent. “The electricity tariff of our country is already higher in comparison to other SAARC countries and further raising it by 20 percent would be unfair to the common people,” argued General Secretary of CRPF Jyoti Baniya.



“…In case the cost of the fuel to be used in the production of electricity or consumer price index changes, the commission shall also change the tariff rate in proportion under a formula that takes into account the change in the cost of fuel and the consumer price index…. While making changes in the electricity tariff, the commission may change it not exceeding more than five percent in the prevailing electricity tariff and only once a year,” the Electricity Tariff Fixation Rules 1994 states in its Procedures Relating to Fixation of Tariff and Other Charges.



The Nepal Electricity Authority (NEA) has not revised its current tariff that has been effective since September 17, 2001. NEA officials and members of the ETFC point to the fact that the tariff has not been revised for over a decade and also argue that the five percent rule is applicable only to make periodic adjustments to offset the hike in the cost of fuel or consumer price index.



The ETFC was preparing to raise the tariff from Falgun (mid-February). Prime Minister Dr Baburam Bhattarai had also agreed in principle to raise electricity tariff during a meeting with the ETFC members on December 21.



“We have yet to receive the court order,” said ETFC Chairman Ganesh Prasad Subba. “We will hold a meeting to decide on our position and understanding of the Electricity Tariff Fixation Rules 1994 and accordingly write our response with the help of legal experts,” Subba added when told about the court order.

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