PTI govt to freeze power tariff for a year

Tariff has been revised 17 times in a year on different accounts

ISLAMABAD: The government is working on a proposal to freeze power tariff for one year amid soaring inflation that has hit people hard.

“We are working on a proposal to freeze power tariff for a year instead of revising it on a monthly or quarterly basis,” Power Division Secretary Irfan Ali told the Senate Standing Committee on Power on Monday.

The power tariff had been revised 17 times in a year on account of monthly fuel and quarterly adjustments, he said, adding that the Power Division was working on a proposal to notify tariff in a year.

He said though the International Monetary Fund (IMF) had some reservations about the issue of power tariff, the Fund agreed with the proposal of introducing yearly power tariff. He refused to provide further details about the proposal, saying a presentation would be given to the prime minister and cabinet in that regard.

PTI govt acknowledges power tariffs higher in Pakistan

He said the Power Division was also working on a plan to spread out the revision in power tariff over a year, adding the increase in power tariff would be gradually passed on to consumers. “A presentation will also be given in this regard,” he said. The power secretary pointed out that the government was working on amending the Nepra Act. Under the plan, any decision of the National Electric Power Regulatory Authority (Nepra) must have to be enforced in order to avoid delay on political consideration.

He said amendments were also being made to challenge Nepra’s decisions in a tribunal. Owing to delay in implementation of Nepra’s decision, K-Electric suffered a loss of Rs80 billion, he added.

Committee members agreed that Nepra’s decisions should be implemented without delay. The power secretary stressed that circular debt had come down during the tenure of the current government. It stood at Rs960 billion, which included pending claims on account of subsidy from the government, he said.

The secretary said Rs38 billion was being added to the circular debt every month last year, which would be reduced to Rs13-15 billion per month in June 2020. Also, it would be reduced to zero in December this year.

Published in The Express Tribune, February 18^th, 2020.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.