ISLAMABAD: The government of Pakistan has approved an increase in electricity prices for consumers in Karachi. This decision was made by the Economic Coordination Committee (ECC) of the cabinet, chaired by Finance Minister Ishaq Dar. The ECC also made amendments to the national electricity transmission policy to award two projects to Gulf countries.
In addition to the electricity price increase, the committee approved a foreign remittances incentive package of Rs80 billion. It also approved a subsidy package of Rs30 billion for the poorest customers of the Utility Stores Corporation (USC).
Regarding the electricity tariff increase for Karachi Electric (KE) consumers, the ECC approved tariff rationalization by way of adjustments applicable to consumption in April, May, and June 2023. These adjustments will be recovered from consumers over the following three months (July, August, and September 2023). This will result in an increase of approximately Rs5 per unit, including taxes and charges.
The ECC also directed the National Electric Power Regulatory Authority (Nepra) to determine quarterly tariffs for government-owned distribution companies to maintain uniform tariffs across the country. The same approach will be applicable to changing KE tariffs. The assessment of subsidy against the determined tariff will shift to an annual basis from the previous monthly or quarterly system.
Furthermore, amendments were made to the Transmission Line Policy 2015 to include ancillary service projects. These amendments are in line with the SIFC’s directive to offer certain energy projects to Gulf countries. The ECC approved awarding these projects to Gulf countries on a cost-plus basis. The concession term for these projects is 15 years.
Additionally, the ECC approved various incentive packages and grants related to remittances, telegraphic transfer charges, and the discontinuation of certain schemes. The committee also discussed matters related to damaged wheat, electricity contracts, and health insurance schemes.
