Grid Transition Levy Rs 791/MMBtu & break-up

19 April 2025

Author: Asif S Kasbati (FCA, FCMA & LLB)

From: Asif Siddiq Kasbati <asif.s.kasbati@professional-excellence.com>
Date: Mon, Mar 17, 2025 at 2:11 PM
Subject: PGEC162= Grid Transition Levy Rs 791/MMBtu & break-up

POL, Gas & Electricity Quick Commentary - PGEC 162

Further to KQU 3288 dated 14.3.25, being an Important matter, we would inform you about GOP, Ministry of Energy (Petroleum Division) Notification of 7.3.25 A levy of PKR 791 has been calculated and will be applied over and above PKR 3,500. making a total of Rs 4291 per MMBTU (Attachment 162.1) in the ensuing paragraph, with emphasis in bold & Underline for quick reading.

2. As per SRO without number dated 7.3.25, in exercise of the powers conferred by sub-section (1) of section 3 of the Off the Grid (Captive Power Plants) Levy Ordinance, 2025 (I of 2025), the Federal Government is pleased to notify that the rate for the purpose of sub-section (1) of the said section 3 shall be Rs 791 in per Million British Thermal Units (MMBtu).

3. Rs. 791/MMBtu Grid Transition Levy Calculation

	Unites	Value
Captives Plants	Thermal Efficiency	36%
Sale price for Captives	PKR/MMBTU	3,500
Gas Cost at Sale Price	PKR/kWh	33.17
O&M / Fixed Cost	PKR/kWh	1.65
Total Energy Cost	PKR/kWh	34.82
Grid B3 Peak (B3 Jan-25)	PKR/kWh	40.3

Levy Calculations

Margin	Grid B3 Peak x 5%	2.015
Increase Req. to remove Grid Disparity & Margin	PKR/kWh	7.49
Revised Gas Price to remove Grid Disparity & Margin	PKR/MMBtu	4,291
Levy Required	PKR/MMBtu	791

4. Notes to the calculation

1. Gas Sale price for Captives determined by OGRA

2. O&M/Fixed cost determined by NEPRA

3. Net Efficiency of Captives conveyed by Industry

4. Current Grid price for B-3 industrial consume PKR (Peak) as determined by NEPRA, exc. Taxes.

5. Fixed Cost for Gas Based CPP determined by NEPRA @ 37.5% efficiency

6. The levy rate will be adjusted based on the revised FCA by the end of the week

5. Further Details & Services

Should you require any clarification or explanations in respect of the above or otherwise, please feel free to email Mr Amsal at amsal@kasbati.co with CC to info.kasbati@professional-excellence.com.

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Grid Transition Levy Rs 791/MMBtu & break-up