Consumers protest proposed Rs34bn power tariff burden

Consumers have taken to the streets in protest against a proposed Rs34 billion additional quarterly tariff burden for power companies. This increase, driven by higher capacity charges due to loadshedding, lower sales, and solar penetration, would amount to approximately Rs1.35 per unit over three months. At a public hearing called by the National Electric Power Regulatory Authority (Nepra), industrial consumers demanded an immediate review of the incremental tariff package, claiming it imposes an extra financial strain of about Rs2 per unit on all consumers.

Major distribution companies reported a 5% reduction in sales, with Nepra member Maqsood Anwar Khan suspecting excessive loadshedding, particularly affecting "good consumers," as a major reason for the decline. Faisalabad Electric Supply Company (Fesco) confirmed loadshedding even in low-loss, high-paying areas, while Islamabad Electric Supply Company (Iesco) noted a Rs1.83 per unit increase in the September-November tariff.

Hazara Electric sought an additional Rs1.65 per unit. Despite claims from power companies, solar penetration was helping sustain the energy sector by reducing system losses and lowering imported fuel costs, according to Nepra member Amina Ahmed. The higher quarterly tariff adjustment (QTA) impact now seemed inevitable, necessitating an urgent review of the incremental package.

Nepra member Naveed Qaiser said a case for review had been submitted but contested the package's damage, stating industrial consumption had generally improved. Industrial consumers from Karachi and Korangi challenged the slight improvement, attributing it to a shift from captive power generation to grid after the government imposed a punitive captive levy on natural gas under IMF instructions to curb power sector circular debt.

The actual additional impact over the quarter was expected to be around Rs17-18 billion, with Nepra member Ahmed indicating that the Rs14 billion sought by Sepco may not form part of the QTA and would need separate examination.