Govt moves to slash electricity prices by Rs2 per unit

The federal government has decided to reduce electricity prices, with a proposed cut of Rs2 per unit for the second quarter of fiscal 2024-25.Power distribution companies have already submitted their adjustment requests to the National Electric Power Regulatory Authority (NEPRA) for approval.If approved, the revised rates will come into effect from March 2025, providing consumers with a relief exceeding Rs52 billion.NEPRA is scheduled to hold a public hearing on the matter on February 12. The price reduction will be reflected in electricity bills for March, April and May.The quarterly adjustment will also apply to K-Electric consumers, although lifeline consumers will not be eligible for the relief.Last week, state-owned Central Power Purchase Agency (CPPA) CEO Rehan Akhtar revealed that electricity consumers of all state-owned distribution companies (Discos) would see only a 28-paise per unit reduction in fuel costs for February, despite a Rs1. 04 per unit lower cost based on December 2024 consumption.He explained that Discos’ consumers had already paid a negative fuel charge adjustment (FCA) of 76 paise per unit in January for November’s consumption and had proposed Rs1.04 per unit for February based on December’s usage. As a result, the net reduction would be just 28 paise per unit.Meanwhile, the Pakistani government failed to convince the International Monetary Fund (IMF) to approve a reduction in sales tax on electricity bills.Sources revealed that the IMF rejected a request from Pakistan’s Ministry of Energy, which had sought tax relief to ease the financial burden on consumers.