Fuel cost for power generation rises 59pc

The cost of fuel for electricity generation in January went up 59 per cent to Rs11.20 per unit from a month ago, according to data recently released by the National Electric Power Regulatory Authority. The rise in the fuel cost was triggered by a decline in hydel- and nuclear-based power generation, according to Tahir Abbas, head of research at Arif Habib Ltd. The share of hydel in the power generation mix slid to 9.4pc in January from 20.4pc in December. The drop in the contribution of hydel led to the spike in the overall average cost since electricity obtained from dams carries zero fuel cost. Similarly, the share of nuclear power dropped to 22pc in January from 27.1pc in the preceding month. The fuel cost for nuclear power generation is only Rs1.07 per unit, lowest of all sources except renewables.