On Thursday Prime Minister Shehbaz Sharif announced Rs 7.41 per unit cut in electricity rates as a relief package for citizens.
Following that Today on Friday, the National Electric Power Regulatory Authority (Nepra) held a hearing on this proposal and has reserved its decision which will be announced soon.
The relief in electricity prices is coming from several adjustments made by the government. Firstly there is a Rs1.71 per unit reduction through a cut in the petroleum levy. Then consumers will benefit from a Rs1.90 per unit relief as part of the second quarter adjustment for the current year. A Rs1.36 per unit decrease is expected from the monthly fuel price adjustment additionally. The third quarter adjustment is also expected to bring a reduction of over Rs1 per unit. Altogether these changes amount to a total relief of around Rs6 per unit before taxes. After including taxes, the total relief will reach approximately Rs7.41 per unit.
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Government officials clarified that this relief depends on the stability of the economic situation.The public can expect to continue receiving this benefit if things stay on track. However there would not be a full rebasing of electricity prices this year instead the government is using quarterly adjustments to lower costs temporarily.
The officials also mentioned that an estimated Rs 58.7 billion will be collected through the petroleum levy over the next three months. This amount is helping cover part of the electricity cost reduction.
Agreements with five independent power producers (IPPs) have contributed to a relief of Rs 12 billion. The government has revised contracts with 32 IPPs in total so far.
