Govt to end slab system punishing power consumers crossing 200-unit threshold

The Pakistani government plans to eliminate the electricity slab system that penalizes consumers for surpassing the 200-unit monthly threshold. Under the existing system, those using up to 200 units receive an Rs13 per unit subsidy, while exceeding the limit by even one unit prompts a steep increase in per unit cost and a six-month ban on protected category benefits.

Power Minister Awais Leghari stated that the ministry was actively working on a plan to abolish the six-month penalty and consider raising the threshold to 250 units or reinstating the protected category benefit for those who restrict consumption to 200 units. The government also aims to transition to an income-based relief system, as the current protected consumer base has expanded from 10 million to 20-25 million over recent years due to solar energy usage.

However, Leghari noted that offering equal discounts to all consumers using less than 200 units would not be equitable, as the subsidy provided to protected consumers currently benefits both the rich and the poor. Meanwhile, the ministry reported that circular debt had decreased to approximately Rs1.67 trillion and was no longer increasing yearly.

The government has set a goal to eliminate this debt within four years through the reprofiling of the financing scheme, and the debt servicing surcharge of Rs3.23 per unit will also be abolished during this period.