ISLAMABAD: The government of Prime Minister Shehbaz Sharif is likely to reduce electricity tariffs by up to Rs 8 per unit within a couple of weeks, pending the final approval from the International Monetary Fund (IMF), well-informed sources told Newzshewz.
The technical working on this issue was discussed in detail at a meeting on Wednesday, chaired by the Committee led by Deputy Prime Minister and Foreign Minister, Senator Ishaq Dar. The reduction will be based on savings from the termination of contracts with five Independent Power Producers (IPPs), adjustments to contracts of bagasse-fired IPPs, revisions to contracts of IPPs and government power plants, and changes in taxes on electricity bills.
Last week, the Prime Minister assured a delegation of businessmen, led by former caretaker Minister for Commerce, Gauhar Ijaz, that electricity tariffs would be reduced before the start of April 2025.
In January 2025, the Prime Minister directed the Power Division to reduce electricity tariffs by Rs 7 per unit starting April 2025. He also expanded the tariff reduction committee by including the then SAPM on Power (now Advisor on Privatisation) Lt. General Muhammad Zafar Iqbal, National Coordinator of the Power Sector Task Force.
Sources revealed that there are about nine elements in the current tariff regime, and by revisiting them, the electricity tariff could potentially be reduced by Rs 10-12 per unit. However, the IMF has refused to remove taxes from electricity bills due to the low recovery rate by the Federal Board of Revenue (FBR), and the provinces are unwilling to eliminate the electricity duty. As a result, the reduction is expected to be around Rs 8 per unit.
According to an official press release, Deputy Prime Minister and Foreign Minister Senator Mohammad Ishaq Dar (@MIshaqDar50) chaired the 6th Ministerial Committee Meeting on Power Tariff Reforms. The meeting was attended by the Minister and Secretary of Power, SAPM Mr. Tariq Bajwa, the Task Force Chief on Electricity, and officials from the Finance Division and other relevant departments.
The committee reviewed proposals for power tariff reforms, with the Task Force providing a comprehensive analysis. The Deputy Prime Minister commended the Task Force’s diligent efforts in this regard.
Currently, the pool price of electricity stands at Rs 35 per unit, excluding taxes and surcharges. However, some relief has been passed on to consumers through negative adjustments in Quarterly Tariff Adjustments (QTAs) and Fuel Charges Adjustments (FCAs).
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