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The government’s new Electric Vehicle (EV) Charging Stations Policy has caused confusion among investors instead of providing the intended facilitation.
This issue came to light during a public hearing conducted by NEPRA regarding the establishment of EV charging stations across the country, which aimed to streamline the charging process for EV owners.
Under the new policy, the government plans to reduce the base tariff for EV charging stations from Rs 45.55 per unit to Rs 23.57, excluding existing taxes and adjustments. However, vendors operating these charging stations will have the discretion to set their own rates for consumers.
During the hearing, Additional Secretary Power Mehfooz Bhatti, CPPA-G representative Naveed Qaisar, and Managing Director NEECA defended the policy and addressed questions raised by the Authority and consumers.
NEPRA Member (Tariff) Mathar Niaz Rana, Member (Law), and Member (KPK) posed several inquiries regarding the proposed mechanism and the criteria for establishing EV charging stations. Additionally, Arif Bilwani questioned the impact of cross-subsidies on other consumers.
Explaining the government’s financial projections, Naveed Qaisar stated that the projected annual revenue from EV charging stations is expected to reach Rs 814 billion, with a cross-subsidy requirement of Rs 9.85 billion (Rs 22 per unit). The incremental sales impact will be Rs 0.18 per unit, leading to a reduction in cross-subsidy costs for other consumers by Rs 0.11 per unit, resulting in a net impact of 7 paisa per unit.
However, a representative from a private company also expressed concerns over inconsistencies in the policy, which have left potential investors uncertain about establishing EV charging stations. Similar concerns were echoed by other stakeholders.
NTDC’s Operating Reserve Policy
During the public hearing on NTDC’s petition regarding its operating reserve policy, NEPRA members noted that NTDC aims to maintain the “Take or Pay” mechanism for operating reserves to stabilize its system, the costs of which would ultimately be borne by consumers.
Power Division officials acknowledged that high electricity prices are deterring investors from entering the EV charging sector. At present, only eight charging stations are operational across the country.
“The government wants to open this market to encourage investment. Our goal is to eliminate regulatory barriers in the country. NEECA has already formulated rules for EV charging stations,” stated Power Division officials.
NEPRA members also raised questions about NEECA’s role in the EV charging sector.
“When charging stations obtain electricity from DISCOs and land from provincial governments, what exactly is NEECA’s role?” questioned NEPRA officials.
The Authority further sought clarification on whether NEECA’s function in the establishment of EV charging stations would be regulatory or facilitative.
“If NEPRA regulates the remaining 38 million electricity consumers, how can NEECA be the regulator for EV charging stations alone?” the Authority observed.
