Consumers to Benefit from Rs26.07 Per Unit Rate for Electricity Above Benchmark Use
The Economic Coordination Committee (ECC) of the Cabinet has approved a three-month winter electricity relief package aimed at reducing gas consumption and encouraging electricity use. The package, announced by Prime Minister Shehbaz Sharif earlier this month, will apply from December 2024 to February 2025.
Key Details of the Relief Package:
- Flat Tariff: Eligible consumers will be charged Rs26.07 per unit for electricity usage exceeding benchmark consumption.
- Savings for Consumers:
- Domestic users can save 30% to 50% per unit depending on their current tariff slabs.
- Industrial users are expected to save 18% to 37% per unit, while commercial consumers may save between Rs13.46 and Rs22.71 per unit.
- Eligibility Criteria: Benchmark consumption will be determined as the higher of the relevant month’s usage in FY2024 or the average historical consumption over the past three years.
Objectives:
The initiative aims to:
- Optimize power generation capacity during the low-demand winter months.
- Reduce reliance on gas for energy needs by shifting demand towards electricity.
During an ECC meeting chaired by Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb, the proposal by the Ministry of Energy was deemed “timely and relevant” in light of recent electricity tariff hikes and decreased demand.
Additional Decisions:
The ECC also approved a proposal by the National Disaster Management Authority (NDMA) to transfer Rs3.14 billion from the erstwhile Emergency Relief Cell (ERC) to the NDMA Fund. These funds, originating from public donations, will be used for inland and overseas rescue and relief operations, with a focus on aiding flood and earthquake victims.
This subsidy-neutral initiative underscores the government’s efforts to alleviate the impact of high electricity costs on consumers while promoting efficient energy use.
