The National Electric Power Regulatory Authority (Nepra) has introduced a new electricity tariff structure which includes fixed monthly charges for all consumer categories effective from July 1, 2024.
The News reported that Nepra has also increased fixed charges by up to 300% for commercial consumers and up to 355% for industrial consumers. These changes are aimed at helping distribution companies (Discos) boost revenue through fixed charges.
For residential consumers, those using 301-400 units per month will pay Rs200, 401-500 units will pay Rs400, 501-600 units will pay Rs600, 601-700 units will pay Rs800, and those using above 700 units will pay Rs1,000 per month.
Residential consumers with time-of-use (ToU) meters will also pay Rs1,000 in fixed charges monthly.
As per report, commercial consumers with a load less than 5kW will pay Rs1,000 per month, while those with a load of 5kW and above will now pay Rs2,000, up from the previous Rs500, reflecting a 300% increase.
For industrial consumers in the B1 category (using up to 25kW under ToU metering), the fixed charge will be Rs1,000. B2 category consumers (using up to 500kW) will see a 300% increase, paying Rs2,000 instead of Rs500 per month. B3 category consumers (using 5,000kW) will experience a 335% increase, paying Rs2,000 instead of Rs460 per month. B4 category consumers (all loads) will also see a 355% increase, with fixed charges rising to Rs2,000 from Rs440.
Currently, the cost structure of electricity comprises 72% fixed charges and 28% variable charges, but fixed charges only contribute 2% to revenue, with variable charges making up 98%. This discrepancy has prompted the new tariff design to better align cost and revenue structures.
The government is set to submit a petition to Nepra seeking a uniform tariff for FY25. Nepra has determined an increase in the base tariff for FY25 at Rs5.72 per unit. The proposed changes in fixed charges are part of this petition.
With the revised base tariff, the power sector, managed by the government, expects to generate over Rs3.763 trillion in revenue for FY25. For FY24, the base tariff was set at Rs29.78 per unit with an increase of Rs4.96 per unit. The new base tariff for FY25 is expected to rise to Rs35.50 per unit.
