Electricity Relief
ISLAMABAD: The federal government’s electricity relief package, which provided a significant Rs7.41 per unit reduction in electricity prices for domestic consumers over the past three months, is set to expire at the end of July. According to official sources, the government has no plans to extend the relief, meaning electricity bills are expected to rise starting August 2025.
The package, initially announced by Prime Minister Shehbaz Sharif in April 2025 as part of a broader effort to cushion the economic burden on citizens, was widely welcomed at the time. Unveiled just before Eid, the prime minister framed the relief as a fulfillment of a key promise made in the PML-N’s election manifesto — a promise originally attributed to party leader Nawaz Sharif.
“I have come to share good news regarding Pakistan’s economic growth on the occasion of Eid,” the prime minister stated during his announcement. “The promise made by Nawaz Sharif in the party manifesto has been fulfilled today.”
The relief package included quarterly tariff adjustments, fuel cost adjustments, and petroleum price-linked reductions. Specifically, consumers received a reduction of Rs1.90 per unit in electricity rates for the second quarter (April–June), followed by Rs1.55 per unit in the third quarter (May–July). Additional components of the relief included a Rs1.71 per unit adjustment linked to petroleum prices and a Rs0.90 per unit cut through fuel price adjustment mechanisms.
Industries also benefited from the government’s intervention, with a separate Rs7.59 per unit reduction in electricity tariffs aimed at supporting industrial growth and competitiveness.
The final phase of the package — the Rs1.55 per unit third-quarter relief — will be reflected in electricity bills issued in July. However, this will mark the last installment of the current subsidy framework.
Energy sector sources confirm that no directive has been issued for continuation of the package beyond July. Meanwhile, the National Electric Power Regulatory Authority (NEPRA) has already conducted a public hearing on a petition seeking a Rs0.10 per unit increase for the Fuel Cost Adjustment (FCA) for May.
However, there is speculation that the FCA for June — to be reflected in July’s electricity bills — may actually be negative, potentially offering minor relief to offset the end of the broader subsidy.
The discontinuation of the Rs7.41 relief package comes amid growing fiscal pressures on the government and ongoing negotiations with international financial institutions over energy reforms and subsidy rationalization.
With rising inflation and energy costs already burdening households and industries alike, the withdrawal of this relief is likely to be felt widely across the country. As August approaches, both consumers and businesses are bracing for higher electricity bills — unless an alternative support mechanism is announced by the government.
