Govt may withdraw power subsidy to industries

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ISLAMABAD: The Rs3 per unit (KWh) subsidy extended to the industrial sector granted by the former Prime Minister Nawaz Sharif in 2015 is likely to be withdrawn by the federal from December 2017 as the Finance Division is averse to release funds to settle the Discos claims.

The Economic Coordination Committee (ECC) of the cabinet had decided on January 28, 2016 had decided that the existing base tariff for the industrial consumers of all Discos be reduced by up to Rs3/kWh for the fiscal 2015-16 for electricity consumed with effect from January 1, 2016 to maintain a uniform tariff and directed the ministry of Water and Power to issue policy guidelines to Nepra not to pass on the negative fuel price adjustment to the industrial consumers till the tariff determination and its notification for all Discos.

The subsidy was also extended to the industrial consumers of K-Electric – now being purchased by a Chinese company, Shanghai Electric – but some issues are still hindering smooth handover of the utility to the new buyer.