Subsidy to domestic sectors using less than 400 units will be reduced by Rs 161 billion.
- Cross-subsidy is collected from users with less than 400 units.
- The government will increase fixed charges for consumers using more than 100 units.
- Single-phase customers are charged higher fixed charges.
ISLAMABAD: Contrary to political parties’ promises to reduce electricity prices, the Electricity Authority has planned to reduce subsidies applicable to domestic consumers by 25%. news Reported on Saturday.
The department, with directives and approval from the Special Investment Facilitation Council (SIFC), has developed a new design to stimulate economic activity to drive export-oriented industrial growth towards the International Monetary Fund (IMF) agreement. It was adjusted.
Treasury officials will seek agreement from global lenders on a tariff rationalization plan drawn up by a power sector think tank.
Under the new tariff structure, the subsidy for domestic sectors using less than 400 vehicles will be reduced from the current Rs 592 billion to Rs 161 billion to Rs 431 billion.
Apart from domestic consumers, agricultural consumers, who received a subsidy of Rs 3.93 billion, will be phased out and will buy a portion of their agricultural tariffs at the cost of services after increasing fixed tariffs and forecasting variable tariffs.
Under the new power tariff design, cross-subsidy of Rs 2,220 crore given to protected lifeline and certain electricity consumers using less than 400 power units will be withdrawn and in return the will impose a fixed charge of Rs 2,220 crore. Those who fell on the lifeline were paid between Rs 50 and Rs 450 per month, protecting consumers who used up to 200 units of electricity per month.
The government will not resist, but rather increase fixed tariffs for unprotected consumers who use more than 100 units of electricity and reduce variable tariffs so that the net tariff increase is less than 1,000 units per month. Decided. The exemption will apply to consumers with high incomes and consumption where the impact on their bills will be less than 10%.
Single-phase consumers who use more than 700 units per month will be charged a hefty fixed fee of Rs 3,000 per month, forcing them to move to the category of using time-of-use (ToU) meters or three-phase meters.
However, the government plans to reduce tariffs for three-phase ToU consumers with a load of 5kW or more, reduce the burden of cross-subsidy, and convert single-phase consumers with monthly consumption of more than 700 units to three-phase electricity consumers. It is. Phase connection. However, cross-subsidies will not be completely abolished, only rationalized. People with multiple connections in one home will be discouraged.
On the one hand, the government has decided to end the Rs 2,220 billion cross-subsidy given by the industrial sector to the domestic sector, and on the other hand, the government has increased the fixed tariff for industrial consumers from Rs 500 per kW to Rs 1,500 per kW. We plan to raise it. kW. However, variable charges will be reduced. As a result of the above initiatives, industrial tariffs will be reduced by a range of 8.5 cents to 11.75 cents per unit, which will enable the country’s industry to compete with regional economies.
Commercial consumers also provide cross-subsidies of Rs 64 billion to other consumers. No changes are proposed to cross-subsidies. However, the tariff design is proposed to be modified to suit domestic and industrial consumers. The fixed tariff for commercial consumers will be increased from Rs500 to Rs1000 per kW and the variable tariff will also be reduced accordingly. This has no material impact on your monthly bill.
Single point consumers subsidize other consumers to the tune of Rs 44 billion. They will continue to receive subsidies. However, the fixed charges will be increased from Rs 800 to Rs 1000 per KW and the variable charges will be reduced, so there will be no real impact on the monthly bill.