Electricity consumers across Pakistan should prepare for another increase in their October bills, as the National Electric Power Regulatory Authority (NEPRA) confirmed a fresh hike following fuel cost adjustments (FCA).
During a public hearing on Monday, officials revealed that the negative FCA of Rs1.79 per unit for July, which had provided some relief in September, will no longer apply from October. Instead, a positive FCA of Rs0.19 per unit for August will be charged, resulting in a cumulative hike of Rs1.98 per unit for most consumers.
The Central Power Purchasing Agency (CPPA-G), representing ex-Wapda distribution companies (Discos) and K-Electric, explained in its petition that the reference fuel cost for August was Rs7.3149 per unit, while the actual average cost of generation stood at Rs7.5059 per unit. To cover the gap, CPPA-G requested permission to recover an additional Rs0.1911 per kilowatt-hour (kWh), which will collectively add Rs2.62 billion to October’s bills.
Consumer representatives raised concerns about mounting taxes and surcharges, noting that a general sales tax (GST) of about Rs0.60 per unit is applied on top of a Rs3.23 per unit surcharge. They argued the government is channeling this surcharge to repay Rs1,225 billion in loans from 18 commercial banks. One intervenor added that the 18 percent GST on the surcharge could speed up loan repayment, reducing the payback period from six years to five.
Industrial Consumers Warn of Rising Electricity Tariffs
Industrial consumers also warned that their costs have already surged by 10 percent due to the expiry of the prime minister’s relief package, with tariffs rising from Rs29 to Rs35 per unit. They urged the government to honor its earlier commitment of supplying electricity at $0.09 per unit.
According to CPPA-G, part of the cost escalation stems from reduced hydropower generation in August. Lower water releases from dams, due to provincial flooding, pushed hydropower’s share in the energy mix down to 38.8 percent from the 40.9 percent reference level, forcing reliance on more expensive imported coal and RLNG.
Addressing concerns about exemptions for flood-affected regions, Power Division officials clarified that the federal government will cover the cost of these subsidies, ensuring they are not passed on to other consumers.