ISLAMABAD: Prime Minister Shehbaz Sharif is expected to announce an Rs8 per unit reduction in electricity tariffs on March 23, following the approval of government proposals by the International Monetary Fund (IMF), sources revealed on Wednesday.
According to sources, officials from the Ministry of Finance and the Power Division are exploring various options to lower electricity prices by Rs2 per unit, while a permanent reduction of Rs6 per unit is also under consideration.
“The proposal will be finalized before March 23,” a source confirmed, adding that the new tariff would take effect from April 1. “As a result, electricity consumers will see lower bills starting in May,” the source added. Of the total Rs8 per unit reduction, Rs4.73 per unit will be a permanent adjustment.
The tariff cut follows the cancellation of contracts with six Independent Power Producers (IPPs) and a revision of agreements with 16 others, shifting them to a ‘take-and-pay’ model, according to insiders.
Additional factors contributing to the price reduction include converting bagasse-based power plants from US dollar-based tariffs to Pakistani rupees—fixing the exchange rate at Rs168 per dollar—and implementing a 13% reduction in the return on equity (ROE) for government power plants (GPPs).
Officials also stated that the tariff adjustment would reflect changes in global oil prices, which declined after March 16, 2025. The estimated fiscal impact of maintaining current oil prices is approximately Rs168 billion.
