Govt Plans Major Cut in Power Tariffs to Ease Consumer Burden

The government is set to announce a significant reduction in electricity tariffs, aiming to provide relief to consumers across Pakistan.

Power Distribution Companies (Discos) have filed petitions seeking a negative adjustment of Rs52.123 billion (approximately Rs2 per unit) for the second quarter of FY 2024-25 under the Quarterly Tariff Adjustment (QTA) mechanism. If approved, the new rates could take effect in March 2025.

The National Electric Power Regulatory Authority (Nepra) will hold a public hearing on February 12 to discuss the proposed adjustments, driven by exchange rate stability and lower interest rates.

Additionally, Prime Minister Shehbaz Sharif is expected to announce a further Rs7 per unit reduction for the industrial sector starting in April, bringing the total tariff cut to Rs9-10 per unit.

Officials say renegotiations with Independent Power Producers (IPPs) are projected to save Rs137 billion annually, contributing to the government’s broader plan to slash energy costs by Rs1.14 trillion. The Federal Cabinet has already approved new contracts to support this initiative.