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Massive Increase in Power Tariffs of up to Rs7.50 per Unit Notified by Nepra

Date: July 25, 2023

ISLAMABAD: The National Electric Power Regulatory Authority (Nepra) has issued a notification, approving a significant increase in the base tariffs of electricity, with an up to Rs7.50 per unit surge, following a request from the federal government. The new tariffs are set to take effect from July 1, 2023.

The decision came after a public hearing on the matter held on Monday (July 24) at Nepra Tower Islamabad, during which the federal government’s application for tariff hike was reviewed and approved.

The power ministry presented its case during the hearing, stating that the increase sought through the “Instant Motion” aligns with the overall revenue requirement determined by Nepra. Despite the proposed increase, the government will provide a subsidy of Rs158 billion, according to the notification.

Notably, the federal cabinet had earlier given the green light to a substantial increase in the base tariff of electricity, with a surge of up to Rs7.50 per unit, surpassing the national average tariff determination of Rs4.96 set by the power regulator.

Prime Minister Shehbaz Sharif assured that lifeline consumers (using up to 100 units) and protected category consumers (using 101-200 units per month) would be exempted from the recent tariff hike.

In addition to this notification, the regulator also raised the tariff to enhance revenue collection for loss-making power distribution companies (Discos) during the current fiscal year.

The federal government sought approval from the cabinet to adjust different rates of increases for various consumer categories through cross-subsidy, without affecting the overall revenue requirement.

According to Nepra’s statement, the revised national average tariff for the fiscal year 2023-24 has been set at Rs29.78 per unit kWh, marking a Rs4.96 per unit increase from the previous national average tariff of Rs24.82.

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