The National Electric Power Regulatory Authority (Nepra) has announced a reduction in electricity tariffs for ex-Wapda distribution companies (Discos) and K-Electric (KE) consumers due to fuel cost adjustments (FCA).
For December 2024, Discos’ tariffs have been decreased by Rs1.2283 per unit, while K-Electric consumers will benefit from a Rs1.23 per unit reduction for November 2024. These adjustments will be applied to electricity bills for February 2025, providing some relief to consumers struggling with high inflation and soaring power costs.
The country’s persistently high electricity tariffs have fueled social unrest and disrupted industries in Pakistan’s $350 billion economy, which has experienced two recent contractions amid record inflation.
According to Nepra, the FCA reduction will apply to most consumer categories but will exclude lifeline customers, domestic users consuming up to 300 units, electric vehicle charging stations, prepaid customers, and agricultural connections. However, domestic consumers with Time of Use (ToU) meters will be eligible for the adjustment, regardless of their electricity usage.
The FCA mechanism revises electricity rates based on fluctuations in fuel costs, with lower fuel prices resulting in reduced bills and higher costs leading to increased tariffs. Nepra has also instructed Discos to comply with court orders while implementing these adjustments.
Pakistan has been compelled to raise power tariffs under an International Monetary Fund (IMF) program aimed at reducing unsustainable public debt in the energy sector. According to the IMF, liquidity challenges in the power sector have worsened due to rising arrears and frequent load shedding.
The accumulation of arrears—resulting from subsidies and unpaid bills—was a key issue in the negotiations between the IMF and the Pakistani government before finalizing the agreement.
Offering potential relief, Prime Minister Shehbaz Sharif stated on Wednesday that the IMF had assured Pakistan that it would not oppose efforts to lower electricity tariffs.
“The IMF chief has assured that Pakistan’s plan for reducing power rates will be considered,” the prime minister said, discussing his recent Dubai visit with the federal cabinet.
During the World Government Summit (WGS) 2025 in Dubai, PM Shehbaz met IMF Managing Director Kristalina Georgieva on Tuesday, ahead of the first review of the $7-billion bailout program, scheduled for early March.
