40% power tariff hike passed on to most consumers

Published: November 30, 2013
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Power companies have forced most consumers across the country to use Time of Use meters, without making any distinction between their income brackets. PHOTO: FILE

Power companies have forced most consumers across the country to use Time of Use meters, without making any distinction between their income brackets. PHOTO: FILE

ISLAMABAD: 

The federal government has apparently misled both the Supreme Court and citizens alike by quietly passing on up to a 40% increase in electricity prices to even those domestic consumers who use less than 200 units a month.

During a hearing of the suo motu case on the power tariff issue, the government had assured the Supreme Court that the hike in electricity prices would not apply to consumers who use up to 200 units a month. Prime Minister Nawaz Sharif had also pledged that the same consumers – who belong to the low income bracket – would be exempt from the increase.

Power distribution companies, however, have increased the tariff for most consumers regardless of their monthly consumption based on the federal government notification which gave effect to the new prices.

The notification stated that the 40% increase in prices was to be passed on to all consumers who use smart or ‘Time of Use’ electricity meters, which apply different rates for daytime and nighttime. Power companies have forced most consumers across the country to use Time of Use meters, without making any distinction between their income brackets.

According to the notification, the new off-peak rate for domestic consumers who use Time of Use meters is Rs12.50 per unit, up from Rs8.90. Similarly, the peak hours electricity rate has been increased to Rs18 per unit from Rs13.99. Consumers who use smart meters but consume less than 200 units a month are charged Rs18 per unit during peak hours, same as consumers who use more than 700 units a month.

Fresh bills issued by the Islamabad Electric Supply Company (IESCO) for the month of October confirmed consumers were charged according to the new rates, irrespective of the relief granted to consumers who use less than 200 units a month. An electricity consumer in IESCO’s jurisdiction was billed Rs2,182 despite using only 134 units in October. The consumer’s off-peak time consumption was 107 units, for which he paid Rs12.50 per unit.

When approached, IESCO Superintendent M Altaf said that the exemption from the increase in electricity prices did not apply to consumers using Time of Use meters. He produced the government notification in his defence.

When contacted by The Express Tribune, a top finance ministry official insisted the premier had not approved any increase in the power tariff for consumers using less than 200 units a month, regardless of whether they used smart meters or not. He said power distribution companies had issued the wrong bills and the mistake would be rectified ‘within 48 hours’.

However, even after five days, neither the Ministry of Finance nor the Ministry of Water and Power issued any clarification in this regard. Despite repeated attempts, the spokesman for the ministry of water and power Zargham Eshaq Khan was not available for comments.

The government increased power rates last month under structural reforms agreed with the International Monetary Fund (IMF) for the Extended Fund Facility loan, which amounts to $6.67 billion. At the time, Finance Minister Ishaq Dar had also announced the government would subsidise power rates for consumers who use less than 200 units a month and bear Rs140 billion in subsidies this year.

Published in The Express Tribune, November 30th, 2013.

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Reader Comments (9)

  • DAJ
    Nov 30, 2013 - 3:20AM

    So is this how NS expects to bring businesses to the country? By raising power prices and whitening black money? smh

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  • Land
    Nov 30, 2013 - 3:30AM

    So this must be the promised change by the sher.

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  • PakistaniLoyalist
    Nov 30, 2013 - 4:26AM

    Meanwhile, Nawaz Sharif wasting government money on laptops
    I wonder what world he lives in, Raiwand Palace is in Pakistan?

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  • Pakistani1
    Nov 30, 2013 - 4:27AM

    Nawaz Sharif policy is to NOT focus on important issues

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  • Nov 30, 2013 - 5:19AM

    A failed government.
    Shame on the PML-N voters. What menace they brought upon my people.

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  • Ahmad
    Nov 30, 2013 - 7:49AM

    You guys wanted Democracy. Now Enjoy.

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  • Ptiworker
    Nov 30, 2013 - 8:43AM

    At least he is getting business and not stopping businesses from coming to Pakistan like PPP.

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  • khan
    Nov 30, 2013 - 1:40PM

    production rates for hydro is 1 rs for most expenisve wind is 12 rs for oil is 18 r and for gas just 4 rs
    net production cost according to govt with all losses is 14 rs yet govt charges 18 rs

    it charges same from 700 units users and 200 unit users
    nawaz is true abusive leader but we still like him..as he is sher-i-pakistn

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  • Ali S
    Nov 30, 2013 - 4:23PM

    Of course, the real culprits who STEAL electricity aren’t being affected at all by any of this. Only sincere, hard-working lower and middle-class folks are being punished for having the decency to pay their bills.

    If NS really wants to overcome the electricity shortage, he should start with conducting a thorough, Rangers-backed operation against all the ‘kundas’ that most katchi abadis and many factories in major cities all over Pakistan run on.

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