NEPRA’s tariff determination risks power crisis in Karachi: say experts

ISLAMABAD: The recent tariff determination for K-Electric (KE) by the National Electric Power Regulatory Authority (NEPRA) may have serious repercussions for both the utility and electricity consumers in Karachi.
The decision, which has sparked widespread debate across social media platforms, is being questioned by energy experts who believe it was influenced by directives from the Power Division. Reports suggest a tense exchange between Power Division officials and NEPRA during public hearings.
“Karachi may soon face prolonged darkness following NEPRA’s revised decision on KE’s Multi-Year Tariff (MYT), which has slashed the utility’s tariff by Rs 7.6,” said one energy expert. “The consequences of this decision could be catastrophic for Karachi’s power consumers and the city’s economy.”
Speaking to NewzShewz, industry analysts warned that the revision will disproportionately impact high-loss areas, where electricity supply may become financially unviable. “This could force KE to curtail or suspend power delivery in those regions altogether,” one expert cautioned, predicting extended blackouts in several parts of the city.
Rehan Jawed, a prominent industrialist and convener at the Korangi Association of Trade and Industry (KATI), added that while the revised MYT may reduce the government’s subsidy burden, it will not necessarily result in lower electricity bills for Karachi’s consumers. “In fact, residents may end up absorbing an additional burden of Rs 30–40 billion in FY 2023 and FY 2024 due to increased Fuel Charge Adjustments,” he said.
Experts also raised concerns over KE’s financial viability. Despite posting a Rs 4 billion profit in FY 2024, the retrospective tariff revision under the new MYT could translate into hundreds of billions in cumulative losses over the next seven years. “Such sustained losses would threaten the company’s operations and its ability to pay suppliers,” analysts warned.
If the situation deteriorates further, they cautioned, Karachi could face a full-scale power crisis—industries may halt production, households may be left without electricity, and KE could spiral into a severe cash flow crisis. Ends